A business purchases equipment for $8,000 cash.Which of the following accounts will be credited?

Question

Quizplus · Accepted Answer

When a business purchases equipment for cash, the cash account will be credited to record the decrease in cash. The equipment account will be debited to record the increase in equipment. Accounts Payable is not relevant in this transaction since no credit was extended, and Common Stock is not affected by this transaction since it was purchased for cash rather than issuing new shares of stock.

A Business Purchases Equipment for $8,000 Cash