Druganaut Company buys a $21,000 van on credit. The transaction will affect the
A) income statement only.
B) balance sheet only.
C) income statement and retained earnings statement only.
D) income statement, retained earnings statement, and balance sheet.

Question

Quizplus · Accepted Answer

The purchase of a van on credit affects the balance sheet by increasing assets (the van) and liabilities (the credit). It does not affect the income statement or retained earnings statement directly.

Druganaut Company Buys a $21,000 Van on Credit