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Determine the effect on the balance sheet after the following transaction. You sell a product purchased for $750 for $1,500.00. This means: Cash increases by $1500 Cash decreases by $750 Owner’s equity increases by $750 Owner’s equity decreases by $750/

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Owner's equity increases by 750$
User Brian Beuning
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Answer:

Third option is correct. Owner’s equity increases by $750.

Explanation:

Owner's equity is the difference between owner's investment and his withdrawal.

If i sell a product purchased of $750 for $1,500. It means the amount of investment is $1500 and the amount of withdrawal is $750.


E=1500-750=750

Since it is positive, therefore the owner's equity increased by $750.

When the product purchased of $750 sell for $1,500, we get the profit of $750.

Therefore, third option is correct. Owner’s equity increases by $750.

User MattF
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