Accounting 9706 · AS & A Level · The accounting system

The accounting system — practice question

A business acquires an asset on credit. What effect does this transaction have on the accounting equation?

  • Aassets increase; liabilities decrease; capital increase
  • Bassets increase; liabilities decrease; capital no change
  • Cassets increase; liabilities increase; capital decrease
  • Dassets increase; liabilities increase; capital no change

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