If the total liabilities of a business decrease by $5000 what will be the effect on total asset? (assuming the amount of capital remain same) -

Question

kasim Abdul Halik · Answer

Option b is correctLiability decreased will reflect asset (bank / cash) also decreased.

Sam Younes · Answer

If Equity remains the same, it will be a DECREASE (Cr) to Total Assets.

lakshminarasimham mallareddi · Answer

Correct Answer is D) Increase by $10000 of total asset as assets equal to liabilities in Balance Sheet .

mehfooz alam khan habib khan · Answer

Option B assets decrease by5000$, assume we paid liabilities by Cheque or by Cash that's why asset will decrease.