If $1,240 cash and a $4,760 note are given in exchange for a delivery truck to be used in a business,
A) assets and liabilities will change by the same amount.
B) owners' equity will be increased.
C) assets will increase and liabilities decrease.
D) assets and liabilities will increase but by different amounts.

Question

Quizplus · Accepted Answer

The exchange involves an increase in assets (the delivery truck) and a decrease in assets (cash) and an increase in liabilities (note payable), resulting in assets and liabilities changing by the same amount.

If $1,240 Cash and a $4,760 Note Are Given in Exchange