Ask Question
BusinessBusiness
14 February, 21:40

Alpha Company has assets of $600,000, liabilities of $250,000, and equity of $350,000. It buys office equipment on credit for $75,000. What would be the effects of this transaction on the accounting equation?

+5
Answers (1)
  1. 14 February, 22:52
    0
    Asset will increase by $75,000 (DR) and liability will as well increase by $75,000 (CR)

    Explanation:

    With the purchase of Office Equipment for $75,000, Assets balance will increase (DR) and liability balance (i. e account payable) will equally increase with the same amount.

    Asset naturally has a debit balance. Any addition will be debited and then the balance will increase.

    Liability has a credit balance. Any addition will be credited, hence increase the balance of the liability.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Alpha Company has assets of $600,000, liabilities of $250,000, and equity of $350,000. It buys office equipment on credit for $75,000. What ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Which of the following is true of both paying with a check and paying with a debit card? Both are accepted by most people and most businesses. A personal identification number must be anytime checks or debit cards are used.
Answers (2)
Don enters into a contract with Eve, who claims to have access to a stock-trading algorithm that will multiply an investment many times over.
Answers (1)
During a meeting, senior executives of a consumer products company tackled the problem that they were late in detecting several consumer trends, such as the trend towards using see-through plastics in kitchenware.
Answers (1)
The purpose of the International Accounting Standards Board is to 1. issue enforceable standards which regulate the financial accounting and reporting of multinational corporations. 2.
Answers (1)
A sharp increase in interest rates will decrease the price of bonds and increase the interest income available to new bondholders. This will increase the demand for bonds compared to the demand for stocks, all other considerations remaining constant.
Answers (1)
New Questions in Business
Tidy Limited purchased a new van on January 1, 2018. The van cost $32,000. It has an estimated life of eight years and the estimated residual value is $3,200. Tidy uses the double-declining-balance method to compute depreciation.
Answers (1)
What two cpt codes describe a review of history, external examination, ophthalmoscopy, bio-microscopy for an acute complicated condition (e. g., iritis) not requiring comprehensive ophthalmological services?
Answers (1)
Jeff is going to sell sporting apparel, which he has already purchased from manufacturers, and has signed a deal agreeing to the volume he will sell monthly.
Answers (1)
One might infer from a debit balance in allowance for doubtful accounts that
Answers (1)
Lee has not been showing up to work on time. which work ethic is he lacking
Answers (1)
Home » Business » Alpha Company has assets of $600,000, liabilities of $250,000, and equity of $350,000. It buys office equipment on credit for $75,000. What would be the effects of this transaction on the accounting equation?
Sign Up Forgot Password?