Decreases in stockholders' equity that result from the cost of operating the business are:
A)assets.
B)revenues.
C)expenses.
D)liabilities.

Question

Quizplus · Accepted Answer

Expenses are costs incurred in the normal course of operating a business that decrease the stockholders' equity, which is why they are considered a decrease in value rather than an increase. Assets are the resources owned by the business, liabilities are obligations or debts, and revenues are the income earned by the business. None of these options accurately describe decreases in stockholders' equity resulting from the cost of operating the business.

Decreases in Stockholders' Equity That Result from the Cost of Operating