Which of following illustrates how selling land for cash affects the financial statements?
A) Option A
B) Option B
C) Option C
D) Option D

Question

Which of following illustrates how selling land for cash affects the financial statements? 
A) Option A 
B) Option B 
C) Option C 
D) Option D

Quizplus · Accepted Answer

Selling land for cash is a one-time transaction that affects the balance sheet. It will increase the cash balance and decrease the land asset balance. Option A shows the correct entry with an increase in cash and a decrease in land value. Option B shows an increase in land value instead of a decrease, which is incorrect. Option C shows a debit to land, which is incorrect. Option D shows a debit to cash, which is also incorrect.

Which of Following Illustrates How Selling Land for Cash Affects