Manziel Inc.is a sole proprietorship owned by Chris Herold.Chris acquired $9,000 worth of equipment for use in his store.He will pay for the equipment in 30 days.The effect of this transaction on Manziel would be to
A)increase the equipment account by $9,000 and increase the accounts payable account by $9,000.
B)increase the equipment account by $9,000 and decrease the accounts payable account by $9,000.
C)increase the equipment account by $9,000 and increase the capital account by $9,000.
D)This would not change any account because the equipment has not been paid for.
E)This would not change any account because this transaction does not affect Manziel Inc.

Question

Quizplus · Accepted Answer

Since Manziel Inc. is a sole proprietorship owned by Chris Herold, the transaction would affect the accounts payable account and the equipment account. The equipment account would be increased by $9,000, representing the cost of the equipment acquired, and the accounts payable account would also be increased by $9,000, representing the amount Chris owes for the equipment that he will pay in 30 days. Therefore, choice A is the best option.