An asset exchange transaction does not affect the total amount of liabilities and equity of a business.

Question

Quizplus · Accepted Answer

An asset exchange transaction involves the exchange of one asset for another asset. Since assets are part of the total amount of assets of a business, the transaction does not affect the total amount of liabilities and equity, which are part of the other side of the balance sheet. Therefore, the answer is true - an asset exchange transaction does not affect the total amount of liabilities and equity of a business.

An Asset Exchange Transaction Does Not Affect the Total Amount