If another player’s token lands on the property that you own and pays you rent, which elements are affected.

Question

BlackTom AI · Accepted Answer

Consider the scenario: when another player’s token lands on your property and pays rent, what balance sheet and income statement elements are affected?
Option a: Owner's Equity and Revenue. This is misleading because rent collection does not directly change Owner's Equity in the sense of contributions or withdrawals by owners; it primarily affects assets and revenue. The equity portion would only change indirectly through net income affecting retained earnings, but the direct effect is not on Owner's Equity and Revenue together.
Option b: Assets and Liabilities. Rent received increases assets (cash or accounts receivable), but there is no immediate effect on Liabilities from this transaction, so pairing assets with liabilities is incorrect.
Option c: Revenue and Expenses. When rent is earned from another player's landing, the firm earns revenue; however, it does not involve an expense in this transaction, since there is no cost incurred by the owner to obtain that rent in the moment of payment. So this pair mislabels the expense side.
Option d: Assets and Revenue. This is the most accurate pair: the business receives payment (cash or receivables), increasing assets, and records revenue from rent earned, reflecting the income in the period. The transaction directly ties to asset inflow and revenue recognition, with no immediate impact on liabilities or expenses.
Therefore, selecting the option that pairs Assets with Revenue correctly captures the financial effects of rent collection on a property you own.

Dashboard Practice non assessable quiz Monopoly sample questions

If another player’s token lands on the property that you own and pays you rent, which elements are affected.

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