Debits must exceed credits on the Statement of Owner's equity.

Name: Debits must exceed credits on the Statement of Owner's equity.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Debits and credits both affect the overall balance of the statement of owner's equity, but they do not necessarily need to be unequal. In fact, if the owner has invested more cash into the business than they have withdrawn, the credits could exceed the debits. Conversely, if the owner has withdrawn more cash than they have invested, the debits could exceed the credits.

Debits Must Exceed Credits on the Statement of Owner's Equity