A-LevelAccountingThe accounting cycle9706/12 · Oct/Nov 2023 · Q161 Mark

A business sells some inventory for $80 on credit. This originally cost $50. How does this affect the statement of financial position?

Acurrent assets: decrease by $30, owner's capital: decreases by $30

Bcurrent assets: decrease by $30, owner's capital: increases by $30

Ccurrent assets: increase by $30, owner's capital: decreases by $30

Dcurrent assets: increase by $30, owner's capital: increases by $30

✓ Correct answer

D: current assets: increase by $30, owner's capital: increases by $30

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Topic: The accounting cycle, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, Oct/Nov 2023 Paper 1 Variant 2, question 16.

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