Question

Which of the following entries causes a decrease in assets and in net income? a. The...

Which of the following entries causes a decrease in assets and in net income? a. The entry to record the payment of utilities with cash b. The entry to record accrued wages payable c. The entry to record revenue earned but not yet received d. The entry to record the payment of cash for the purchase of a building

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Answer #1

a) Payment of utilities with cash decrease cash (assets) and revenue (net income)

b) Accrued wages payable increase liabilities (wages payable) and decrease net income by Wages expense

c) Record revenue but not yet received increase net income by revenue and increase assets (account receivable)

d)Payment of cash for building increase assets( building) and decrease assets (cash) so at the end no change in assets

Which of the following entries causes a decrease in assets and in net income?

So answer is a. The entry to record the payment of utilities with cash

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