Which one of the following represents the expanded basic accounting equation?
A) Assets = Liabilities + Contributed Capital + Retained Earnings + Revenues - Expenses - Dividends
B) Assets + Liabilities = Dividends + Expenses + Contributed Capital + Revenues
C) Assets - Liabilities - Dividends = Contributed Capital + Revenues - Expenses
D) Assets = Revenues + Expenses - Liabilities

Question

Quizplus · Accepted Answer

The expanded basic accounting equation is Assets = Liabilities + Owner's Equity, where Owner's Equity can be broken down into Contributed Capital + Retained Earnings. Retained Earnings itself is further broken down into Beginning Retained Earnings + Revenues - Expenses - Dividends. Therefore, the full expanded equation is Assets = Liabilities + Contributed Capital + Retained Earnings + Revenues - Expenses - Dividends, which matches option A.

Which One of the Following Represents the Expanded Basic Accounting