Question: A fellow student asked you the following I understand that

A fellow student asked you the following: “I understand that a debit increases an expense account. I also understand that a debit decreases retained earnings. But if an expense account is a part of retained earnings (a ‘little’ stockholders’ equity account), how can a debit entry have a different effect on retained earnings than it does on an expense account?” Provide an explanation to the student.

Sale on SolutionInn
  • CreatedFebruary 20, 2015
  • Files Included
Post your question