Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 5 - No. 48)

What is the effect on the accounting equation when the owner invests cash in the business?
Assets increase, liabilities decrease.
Assets decrease, owner's equity increases.
Assets increase, owner's equity increases.
Liabilities increase, owner's equity decreases.

Explanation

Assets increase, owner's equity increases.

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