Which of the following types of transaction will result in an accounting entry that will not change the recorded equity of a company?
A) Paying cash for new inventory
B) Paying for the current month's rent expense
C) Paying dividends to the owners
D) Paying the principal amount due on a bank loan

Question

Quizplus · Accepted Answer

Paying cash for new inventory is an asset exchange transaction that does not affect equity. It increases inventory (an asset) and decreases cash (another asset) by the same amount, leaving equity unchanged.

Which of the Following Types of Transaction Will Result in an Accounting