Which account categories are affected by the sales transactions?

Which account categories are affected by the sales transactions?

• A. Assets and Liabilities
• B. Assets and Owner's Equity
• C. Liabilities and Owner's Equity
• D. Expenses and Liabilities

Answer: (B)

When a sale happens, you record an increase in assets (cash or accounts receivable) and a corresponding increase in equity through revenue. The revenue boosts Owner's Equity (via higher net income and retained earnings), so the two account categories directly affected are Assets and Owner's Equity. Liabilities aren’t generated by the sale itself, and while costs related to the sale (like cost of goods sold) affect expenses later, the immediate recording of a sale centers on asset growth and equity growth.

When a sale happens, you record an increase in assets (cash or accounts receivable) and a corresponding increase in equity through revenue. The revenue boosts Owner's Equity (via higher net income and retained earnings), so the two account categories directly affected are Assets and Owner's Equity. Liabilities aren’t generated by the sale itself, and while costs related to the sale (like cost of goods sold) affect expenses later, the immediate recording of a sale centers on asset growth and equity growth.