A business acquires equipment costing $10,000 by making a $2,000 down payment and issuing a note for the balance. This transaction will cause:

Question

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The equipment is debited for the full cost of $10,000, reflecting its addition to the company's assets. The down payment reduces cash, and the balance is noted as a liability (notes payable), not affecting the equipment account directly.

A Business Acquires Equipment Costing $10,000 by Making a $2,000