A business acquires a parcel of land by issuing a note payable for $50,000. This transaction causes:
A)total assets to increase.
B)owner's equity to increase.
C)assets to increase and equity to increase.
D)liabilities to decrease.

Question

Quizplus · Accepted Answer

Issuing a note payable for acquiring land increases total assets (the land) while also increasing liabilities (the note payable), with no immediate effect on owner's equity.

A Business Acquires a Parcel of Land by Issuing a Note