Which of the following could represent the effects of an asset exchange transaction on a company's financial statements?
A) Option A
B) Option B
C) Option C
D) Option D

Question

Which of the following could represent the effects of an asset exchange transaction on a company's financial statements? 
A) Option A 
B) Option B 
C) Option C 
D) Option D

Quizplus · Accepted Answer

Option A shows an increase in assets and a decrease in liabilities, which would affect the balance sheet. It also shows no effect on the income statement. Option B shows an increase in assets and an increase in equity, which would affect the balance sheet. It also shows no effect on the income statement. Option C shows a decrease in assets and a decrease in equity, which would affect the balance sheet. It also shows no effect on the income statement. Option D shows a decrease in assets and an increase in liabilities, which would affect the balance sheet. It also shows no effect on the income statement. Therefore, the best choice is A because it accurately reflects the effects of an asset exchange transaction on a company's financial statements.

Which of the Following Could Represent the Effects of an Asset