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Accounting

What is the role of accounting in business? Elaborate your points by providing some real-life examples of the application of Accounting.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter3: Analyzing And Recording Transactions

Section: Chapter Questions

Problem 6Q: What is the effect on the accounting equation when a business purchases supplies on account?

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Concept explainers

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is

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What is the effect on the accounting equation when a business purchases supplies on account?