Which of the following statements regarding revenues and expenses is true?
A) Both revenues and expenses typically have credit balances.
B) Revenues and expenses are considered assets and liabilities, respectively.
C) Revenue is the same as Cash.
D) Expenses decrease the amount of stockholders' equity.

Question

Quizplus · Accepted Answer

Expenses represent outflows of resources, which decrease the amount of stockholders' equity. Revenues, on the other hand, increase stockholders' equity. Both revenues and expenses typically have debit balances. Revenue is not the same as Cash, as revenue can be earned but not yet received in cash. Revenues and expenses are not considered assets and liabilities.

Which of the Following Statements Regarding Revenues and Expenses Is