What effects on a retail store's accounting equation occur when it records merchandise purchased for cash, assuming the use of a perpetual inventory system?

Name: What effects on a retail store's accounting equation occur when it records merchandise purchased for cash, assuming the use of a perpetual inventory system?
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Question

Quizplus · Accepted Answer

Purchasing merchandise for cash in a perpetual inventory system decreases one asset (cash) while increasing another (inventory), leaving the overall accounting equation unchanged.

What Effects on a Retail Store's Accounting Equation Occur When