The accounting equation for Long Company shows an increase in its assets and an increase in its liabilities.Which of the following transactions could have caused that effect?
A)Cash was received from providing services to a customer.
B)Cash was received as a stockholder investment.
C)Equipment was purchased on credit.
D)Supplies were purchased for cash.
E)Advertising expense for the month was paid in cash.

Question

Quizplus · Accepted Answer

Purchasing equipment on credit would increase Long Company's assets (equipment) and liabilities (accounts payable). Choices A, B, D, and E do not involve an increase in liabilities.

The Accounting Equation for Long Company Shows an Increase in Its