Question

Which of the following does NOT occur when

Answer 1

Borrowing of assets does NOT occur when dealing with equity, as the equity share is the proportion a person have invested.

What is equity in business?

Equity is the amount or anything which is invested by the shareholder at the time of commencement of the business.  It can be said that it is the total of assets minus total of liabilities is equal to equity. Example of equity are Common stock, additional paid-in capital, preferred stock and others.

Thus, option B is correct.

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