What are the effects on the accounting equation from the adjustment for income tax expense accrued,but not paid,at the end of the accounting period?
A)Total liabilities will decrease and total stockholders' equity will decrease.
B)Total liabilities will increase and total stockholders' equity will decrease.
C)Total liabilities will decrease and total stockholders' equity will increase.
D)Total liabilities will increase and total stockholders' equity will increase.

Question

Quizplus · Accepted Answer

The amount of income tax accrued,but not paid,during the current period should be recorded as an increase to the liability,Income Tax Payable,and an increase to Income Tax Expense.An increase in an expense account results in a decrease to stockholders' equity.

What Are the Effects on the Accounting Equation from the Adjustment