Which of the following transactions changes the mix of only liabilities?
A) Paying off accounts payables by raising a short-term loan
B) Writing off accounts receivable as bad debt
C) Financing the purchase of land with a long-term loan
D) Paying accounts receivable with cash

Question

Quizplus · Accepted Answer

Paying off accounts payables by raising a short-term loan changes the mix of only liabilities because it decreases accounts payable (a current liability) and increases the short-term loan (another current liability). The other transactions involve changes to both assets and liabilities.

Which of the Following Transactions Changes the Mix of Only