Answered: explain how this affect the accounting…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter2: Introduction To Financial Statements

Section: Chapter Questions

Problem 5MC: Assume a company has a $350 credit (not cash) sale. How would the transaction appear if the business...

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1. Suppose a business receives a bill for services rendered from one of its
suppliers. The business will pay the supplier next month. When the business
receives the bill from its supplier, explain how this affect the accounting equation in terms of increasing or decreasing assets, liabilities, or owner’s equity?

2. Suppose equipment is sold for cash in an amount equal to the cost of the
equipment recorded on the books. How does this sale affect the accounting
equation in term of increasing or decreasing assets, liabilities or owner’s equity?

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