How does the purchase of equipment for cash affect the accounting equation?
How do you record purchase of equipment?
Is equipment a cash asset?
When a company pays cash for equipment What is the effect on the accounting equation for the company?
Is cash included in cash flow statement?
Is cash a revenue?
What happens when a company purchases equipment by paying cash for it?
Does purchasing equipment increase asset?
The company makes the purchase with cash on the balance sheet. This means that everything takes place on the asset side of the balance sheet: Increase in Assets: Equipment. Decrease in Assets: Cash.
What will the effect be of cash received for services rendered?
If a business receives cash for rendered services, it increases the company’s assets. Service revenue generates income, which increases the company’s capital.
When equipment is purchased on credit assets and liabilities increase?
When a company purchases land with cash?
What are the effects of transactions on the accounting equation?
|Transaction Type||Assets||Liabilities + Equity|
|Sell goods on credit (part 2)||Accounts receivable increases||Income (equity) increases|
|Sell services on credit||Accounts receivable increases||Income (equity) increases|
|Sell stock||Cash increases||Equity increases|