How would the accounting equation of Lenore Turner's consulting business be affected by the billing of a client for $2,000 for consulting work completed?
A) Accounts receivable, $2,000 increase, liabilities, $2,000 decrease.
B) Accounts receivable, $2,000 increase, liabilities, $2,000 increase.
C) Accounts receivable, $2,000 increase, cash, $2,000 increase.
D) Accounts receivable, $2,000 increase, equity, $2,000 increase.
E) Accounts receivable, $2,000 increase, cash, $2,000 decrease.

Question

Quizplus · Accepted Answer

Billing a client increases accounts receivable and also increases equity because it represents earned revenue, which increases the owner's equity in the business.

How Would the Accounting Equation of Lenore Turner's Consulting Business