Altoona Products buys a $500,000 machine by taking out a bank loan.The company's assets will _____ by $500,000 while its liabilities will _?____?? by $500,000.
A)rise; rise
B)fall; fall
C)rise; fall
D)fall; rise

Question

Quizplus · Accepted Answer

When a company buys a machine by taking out a loan, its assets increase due to the addition of the machine, and its liabilities increase by the amount of the loan taken to purchase the machine.

Altoona Products Buys a $500,000 Machine by Taking Out a Bank