During 2013, Bledsoe Company earned $6,700 of cash revenue, paid cash dividends of $950 to owners and paid $5,000 for cash expenses. Liabilities were unchanged. Which of the following accurately describes the effect of these events on the elements of the company's financial statements?
A)Assets increased by $7,700.
B)Assets increased by $750.
C)Equity increased by $2,700.
D)Both B and C

Question

Quizplus · Accepted Answer

Revenue - Expenses - Dividends = Change in Equity $6,700 - $950 - $5,000 = $750 change in equity. If there was no change in liabilities, the change in assets must also equal $750.

During 2013, Bledsoe Company Earned $6,700 of Cash Revenue, Paid