Argus Company experienced an accounting event that affected its financial statements as indicated below: Which of the following accounting events could have caused the indicated effects on the company's accounting equation?
A) Applied manufacturing overhead to work in process.
B) Purchased raw materials for cash.
C) Paid cash wages of production workers.
D) All of these answers are correct.

Question

Argus Company experienced an accounting event that affected its financial statements as indicated below:  Which of the following accounting events could have caused the indicated effects on the company's accounting equation?
A) Applied manufacturing overhead to work in process. 
B) Purchased raw materials for cash. 
C) Paid cash wages of production workers. 
D) All of these answers are correct.

Quizplus · Accepted Answer

All of the events (applying manufacturing overhead to work in process, purchasing raw materials for cash, and paying cash wages of production workers) would affect the company's accounting equation by increasing assets (work in process, raw materials, and cash) and increasing liabilities/equity (accounts payable and retained earnings). Therefore, all of the answer choices are correct.

Argus Company Experienced an Accounting Event That Affected Its Financial