Final answer:
If total assets increase, it must be offset by an equal increase in liabilities and/or stockholders' equity, not necessarily through an investment in fixed assets or an increase in stockholders' equity, net working capital, or positive net income.
Step-by-step explanation:
When total assets increase on a company’s balance sheet, it does not necessarily mean that a specific component such as stockholders' equity or fixed assets must increase. It is more accurate to say that the total increase in assets must be matched by an equivalent increase in the financing of those assets. This can occur through various forms of financial capital, such as early-stage investors, reinvesting profits, borrowing through banks or bonds, and selling stock. Therefore, the correct statement is that the increase in total assets must be offset by an equal increase in liabilities and/or stockholders' equity (Option 3).
It’s also important to note that the change in total assets does not require an investment in fixed assets, an increase in stockholders' equity, an increase in net working capital, or positive net income to have occurred. These scenarios may contribute to the increase in total assets, but they are not necessary conditions for the increase.