If you debit an expense account, what impact does that have on stockholders' equity?
A)Decreases stockholders' equity
B)Increases stockholders' equity
C)There is no effect on stockholders' equity
D)Decreases net income but has no effect on stockholders' equity

Question

Quizplus · Accepted Answer

Debiting an expense account means that an expense has been incurred, which decreases the company's earnings or net income. Since stockholders' equity is calculated as the difference between a company's assets and liabilities, a decrease in net income leads to a decrease in stockholders' equity.

If You Debit an Expense Account, What Impact Does That