For an accounting equation to balance, a transaction must affect both the sides of the equation.

Name: For an accounting equation to balance, a transaction must affect both the sides of the equation.
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Question

Quizplus · Accepted Answer

A transaction can affect only one side of the accounting equation as long as the total assets equal the total liabilities plus equity. For example, purchasing equipment with cash affects only the asset side but keeps the equation balanced.

For an Accounting Equation to Balance, a Transaction Must Affect