A new managing director was appointed to commence in 3 months' time on a salary of $250 000 per annum.
A) A liability increased and another liability decreased.
B) An asset decreased and a liability decreased.
C) An asset increased and revenue increased.
D) This had no effect on the accounting equation.

Question

Quizplus · Accepted Answer

The appointment of the managing director has no direct effect on the accounting equation, as no transactions have occurred yet. Therefore, there is no change to any assets, liabilities, or equity.

A New Managing Director Was Appointed to Commence in 3