Answer:
D. Increased $45,00
Explanation:
Assume that the total assets of the business was $100,000 and the liabilities was $50,000 and the equity was also $50,000.These figures can be expressed in terms of the accounting equation as follows:
Total assets=Total liabilities+Total equity
100,000=50,000+50,000
Now consider that the above mentioned liabilities are increased by $75,000 as stated in question and above mentioned equity is decreased by $30,000 as stated in question, then the assets as per accounting equation can be determined as follows:
Total liabilities=50,000+75,000=$125,000
Total equity=50,000-30,000=$20,000
Assets=$125,000+$20,000=145,000
Total increase in assets=$145,000-$100,000=$45,000
So the answer is D. Increased $45,000
