Borrowing money from a bank would:
A)have no effect on owner's equity.
B)decrease assets.
C)decrease liabilities.
D)increase revenues.

Question

Quizplus · Accepted Answer

Borrowing money from a bank increases both assets (cash or the equivalent that is received) and liabilities (the amount owed to the bank), but it does not directly affect the owner's equity or revenues. Owner's equity is affected by profits and losses, not by the creation of liabilities.

Borrowing Money from a Bank Would