When an organisation purchases a machine for cash, which of the following is true?
A) Total assets increase.
B) Total liabilities decrease.
C) Total expenses increase.
D) Total equity stays the same.

Question

Quizplus · Accepted Answer

Purchasing a machine for cash affects the composition of the assets (cash decreases while machinery increases), but the total assets remain the same. Liabilities are not affected by this transaction, and it does not immediately affect expenses or equity. Total equity remains unchanged as the purchase is an exchange within assets.

When an Organisation Purchases a Machine for Cash, Which of the Following