Question: To understand how the income statement does this, lets look at the January 5 transaction for Evergreen Market. On January 5, Evergreen Market sold for

To understand how the income statement does this, let’s look at the January 5 transaction for Evergreen Market. On January 5, Evergreen Market sold for $800 cash some merchandise that had cost $500.

This caused equity (Retained Earnings) to [increase / decrease] by

$ .

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