Mineola Company paid $30,000 cash to purchase land. As a result of this business event,

Name: Mineola Company paid $30,000 cash to purchase land. As a result of this business event,
Brand: Quizplus
Rating: 4.9 (41 reviews)

Question

Quizplus · Accepted Answer

Paying cash to purchase land is an asset exchange transaction that decreases one asset (cash) and increases another asset (land); therefore, there is no overall effect on total assets, total liabilities, or total equity. It is reported as a cash outflow for investing activities on the statement of cash flows.

Mineola Company Paid $30,000 Cash to Purchase Land