C describe the process of recording business transactions using an accounting system based on the accounting equation;

Question 1

How does one keep the accounting equation in balance?

Answer 1

By double-entry accounting in which a transaction has to be recorded in at least 2 accounts

A change in Assets reflects a change in L or SE or both

Question 2

Basic Accounting Process

Answer 2

Event>record>summary>adjust>report

Question 3

The purchase of equipment for $25,000 cash is most likely to be recorded as:
A) an increase in an asset account and an increase in a liability account.
B) an increase in two asset accounts.
C) an increase in one asset account and a decrease in another asset account.
Your answer: C was correct!
The purchase of equipment for cash is an increase in property, plant and equipment (an asset) and a decrease in cash (another asset).

Answer 3

The purchase of equipment for $25,000 cash is most likely to be recorded as:
A) an increase in an asset account and an increase in a liability account.
B) an increase in two asset accounts.
C) an increase in one asset account and a decrease in another asset account.
Your answer: C was correct!
The purchase of equipment for cash is an increase in property, plant and equipment (an asset) and a decrease in cash (another asset).