Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 21 - No. 19)
Which of the following transactions decreases owner's equity?
The owner invests cash in the business.
The business pays rent.
The owner withdraws cash for personal use.
The business sells goods for cash.
Explanation
The business paying rent creates an expense that reduces equity. The owner withdrawing cash also reduces equity through drawings.
Comments (0)
