The effect on the accounting equation of the business paying $275 cash for mobile phone charges is:
A) a decrease in the asset cash of $275 and a decrease in the liability accounts payable of $275
B) a decrease in the asset cash of $275 and a decrease in profit and loss of $275 to record the phone expense.
C) an increase in the asset cash of $275 and a decrease in profit and loss of $275 to record the phone expense.
D) a decrease in the asset cash of $275 and an increase in profit and loss of $275 to record the phone expense.
Correct Answer:
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