Question
2. What is the effect when the owner invests 300 in the business? A. Assets decrease 300 and owner's equity decreases 300 B. Assets increase 300 and owner's equity increases 300 C. Assets increase 300 and owner's equity decreases 300 D. Liabilities increase 300 and owner's equity decreases 300
Answer
4
(349 Votes)
Xavier
Professional · Tutor for 6 years
Answer
B
Explanation
When the owner invests money into the business, it increases the owner's equity and the assets of the business by the same amount. This is because the owner's investment is used to purchase assets for the business, whether it be in the form of cash, property, or equipment. Therefore, if the owner invests
300.