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The capital of a business would change as a result of:
A a supplier being paid by cheque
B raw materials being purchased on credit
C non-current assets being purchased on credit
D wages being paid in cash
The answer is B
but l dont understand why it is soThe Capital of a Business changes when the wages are being paid in cash
That’s the correct answer
taak: Please do not answer questions in this forum – it is Ask the Tutor, and you are not the tutor 🙂 (But please do help people in the other Paper F3 forum)
suleymanabuzerli: Where on earth did you find this question? Because assuming you have copied it all correctly, the answer is certainly not B! Taak is right – the correct answer is D.
Paying wages (whether in cash or not) is an expense which reduces the profit and therefore reduces the capital.Are you watching my free lectures? The lectures are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.
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