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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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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