Increases to owner's equity may be from
A) expenses that are incurred.
B) expenses exceeding revenue for the period.
C) withdrawals of cash from the business by the owner.
D) revenue that is derived from sales of goods or services.

Question

Quizplus · Accepted Answer

Increases to owner's equity are typically from revenue that is derived from sales of goods or services. This increases the assets of the business and therefore increases the owner's equity. Expenses (A and B) and withdrawals of cash by the owner (C) decrease owner's equity.

Increases to Owner's Equity May Be from