Where would you record an increase in the net profit for the period?

The correct approach to recording an increase in net profit for the period is to credit proprietorship or proprietors' equity. This is because net profit ultimately increases the owner's equity in the business.

When a business earns a profit, that profit effectively increases the total equity held by the owner(s). This increase reflects a gain or positive change in the financial position of the proprietorship, which is why it is recorded as a credit.

Crediting proprietorship indicates that the business has made more money than it has spent, leading to an increase in the owner's financial interest in the business. This adheres to the accounting equation which states that assets equal liabilities plus equity; when net profit increases equity, it enhances the financial health of the business as reflected in its records.

The other options do not apply here: debiting income would not be correct as income should be credited when earned, debiting liabilities would decrease liabilities rather than appropriately represent an increase in profit, and crediting proprietor's equity (while similar) is not specific enough to convey the correct accounting treatment for this transaction.