Consider the following transactions:
Issued common stock for cash.
Purchased equipment by signing a note payable.
Paid rent for the current month.
Collected cash from customers on account.
How many of these four transactions increased the given company's total assets?

Question

Consider the following transactions:
 Issued common stock for cash.
Purchased equipment by signing a note payable.
Paid rent for the current month.
Collected cash from customers on account.
How many of these four transactions increased the given company's total assets?

Quizplus · Accepted Answer

The two transactions that increased the company's total assets are issuing common stock for cash and purchasing equipment by signing a note payable. Both of these transactions involve an increase in assets, either in the form of cash or equipment. Paying rent and collecting cash from customers on account do not result in an increase in total assets.

Consider the Following Transactions