Hazy Shades received and paid a utility bill for $725 for the month of March. This transaction will
A) increase Cash and increase Utility Expense.
B) decrease Cash and increase Utility Expense.
C) increase Cash and decrease Utility Expense.
D) increase Utility Expense and decrease Withdrawal.

Question

Quizplus · Accepted Answer

The payment of a utility bill will result in a decrease in cash as money is leaving the business. The payment will also increase Utility Expense as it is a cost incurred by the business. Therefore, Option B is the correct choice.

Hazy Shades Received and Paid a Utility Bill for $725