Able2 Company received a cash advance of $800 from a customer. As a result of this event
A) assets increased by $800.
B) owner's equity increased by $800.
C) liabilities decreased by $800.
D) assets and owner's equity both increased by $800.

Question

Quizplus · Accepted Answer

When Able2 Company receives a cash advance of $800 from a customer, it increases its assets by $800 (in this case, cash). There is no impact on owner's equity or liabilities.

Able2 Company Received a Cash Advance of $800 from a Customer