Multiple choice

If the owner of a company invested cash in a business enterprise, the transaction would include

  1. debiting Capital and crediting Cash.

  2. debiting Cash and crediting Revenue.

  3. debiting Cash and crediting Capital.

  4. debiting Revenue and crediting Cash.

Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

When an owner invests cash, the business asset (Cash) increases, which is a debit. The owner's equity (Capital) also increases, which is a credit.