Ramos Repair Company is paying a cash dividend. How does this transaction affect Ramos Repair Company's accounting equation? a. decrease in assets (Cash) and decrease in liabilities (Accounts Payable) b. increase in assets (Cash) and decrease in stockholders' equity (Dividends) c. decrease in assets (Cash) and decrease in stockholders' equity (Dividends) d. increase in assets (Accounts Receivable) and decrease in assets (Cash)
Added by Andrew P.
Close
Step 1
When a company pays a cash dividend, it decreases its cash (an asset) and decreases its retained earnings (part of stockholders' equity). Show more…
Show all steps
Your feedback will help us improve your experience
Brooke Bussoletti and 71 other Principles of Accounting educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Recommended Videos
Rosewood Corporation purchased land for $110,000 by making a cash payment of $36,000 and promising to pay the remaining amount in a later accounting period. What is the net effect of this transaction on Rosewood's accounting equation? A. Assets increase by $110,000 and liabilities decrease by $74,000. B. Assets and liabilities increase by $74,000. C. Assets increase by $110,000 and liabilities decrease by $36,000. D. Assets and equity increase by $74,000.
Brooke B.
25. Stats Co. remitted payment to a vendor for goods delivered earlier this month. What is the effect on the accounting equation for Stats Co.? A. Assets decrease and liabilities decrease B. Liabilities decrease, Assets decrease and owners equity decrease C. Liabilities decrease and owners equity increases D. Assets increase and owners equity decreases E. There will be no change to the accounting equation
Supreeta N.
Saturn, Inc. paid $8,000 on accounts payable. How does this transaction affect the accounting equation of Saturn? A. Assets increase by $8,000 and equity decreases by $8,000. B. Assets increase by $8,000 and liabilities increase by $8,000. C. Assets decrease by $8,000 and liabilities decrease by $8,000. D. Assets decrease by $8,000 and equity increases by $8,000.
Recommended Textbooks
Horngren’s Cost Accounting
Cost Accounting A Managerial Emphasis
Principles of Accounting Volume 1: Financial Accounting
Transcript
18,000,000+
Students on Numerade
Trusted by students at 8,000+ universities
Watch the video solution with this free unlock.
EMAIL
PASSWORD