Question

    The capital of a sole trader would change as a result

    :
    A A creditor being paid his account by cheque. Correct Answer Incorrect Answer
    B Raw materials being purchased on credit. Correct Answer Incorrect Answer
    C Fixed assets being purchased on credit. Correct Answer Incorrect Answer
    D Wages being paid in cash. Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Wages are expenses which impact P&L, it will reduce the profit which eventually added to capital; hence it will impact the capital of sole trader.

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