A transaction that causes an increase in an asset may also cause a decrease in another asset, an increase in a liability, or an increase in equity.

Question

Quizplus · Accepted Answer

This statement is true. Every transaction in accounting has a dual effect, meaning that at least two accounts are affected. An increase in one asset may be matched with a decrease in another asset or with an increase in a liability or equity account.

A Transaction That Causes an Increase in an Asset May