Answer:
c.liabilities increase; owner's equity decreases
Explanation:
Accounting Equation is represented by the following formula:
Assets = Liabilities + Owner's Equity
When a bill to be paid next month is received in the current month, it establishes a liability, and expense account is debited whereas a due liability account is credited.
This would reduce the profits which would in turn reduce the owner's equity and at the same time increase the liabilities amount.
