assignment: audit your understanding 1-3 (practice)\nquestions gi6mc11h.au.1-3.01\nhow is owners equity…

Brief Explanations:

When cash is received from sales, revenues increase. Revenues are part of owner's equity. According to the accounting equation (Assets = Liabilities + Owner's Equity), an increase in revenues (which is a component of owner's equity) leads to an increase in owner's equity.

Answer:

Owner's equity increases.