Last year, assets of Adventure Tours increased by $7,000 and the company's liabilities decreased by $3,000. During this time the owners' equity balance in the company must have:

Question

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The owners' equity balance increased by $10,000 because the increase in assets ($7,000) and the decrease in liabilities ($3,000) both contribute to an increase in owners' equity, totaling $10,000.

Last Year, Assets of Adventure Tours Increased by $7,000 and the Company's