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What impact does the following transaction have on the financial statements? a) Received utility bill for the current month; the bill will be paid next month. b) Net income goes down; assets and liabilities both go up. c) Net income goes down; assets and liabilities both go down. d) Net income goes down; assets and stockholders' equity both go down. e) Net income goes down; liabilities go up and stockholders' equity goes down. f) No effect on net income; assets and liabilities both go up.

What impact does the following transaction have on the financial statements? a) Received utility bill for the current month; the bill will be paid next month. b) Net income goes down; assets and liabilities both go up. c) Net income goes down; assets and liabilities both go down. d) Net income goes down; assets and stockholders' equity both go down. e) Net income goes down; liabilities go up and stockholders' equity goes down. f) No effect on net income; assets and liabilities both go up.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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What impact does the following transaction have on the financial statements? a) Received utility bill for the current month; the bill will be paid next month. b) Net income goes down; assets and liabilities both go up. c) Net income goes down; assets and liabilities both go down. d) Net income goes down; assets and stockholders' equity both go down. e) Net income goes down; liabilities go up and stockholders' equity goes down. f) No effect on net income; assets and liabilities both go up.
Transcribed Image Text:What impact does the following transaction have on the financial statements? a) Received utility bill for the current month; the bill will be paid next month. b) Net income goes down; assets and liabilities both go up. c) Net income goes down; assets and liabilities both go down. d) Net income goes down; assets and stockholders' equity both go down. e) Net income goes down; liabilities go up and stockholders' equity goes down. f) No effect on net income; assets and liabilities both go up.
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