A transaction caused a $15,000 decrease in both total assets and total liabilities. This transaction could have been:
A) Purchase of a delivery truck for $15,000 cash.
B) An asset with a cost of $15,000 was destroyed by fire.
C) Repayment of a $15,000 bank loan.
D) Collection of a $15,000 account receivable.

Question

Quizplus · Accepted Answer

Repayment of a bank loan would result in a decrease in both total assets and total liabilities. The other options would only affect one side of the equation, either decreasing assets (option B) or increasing assets (options A and D) without affecting liabilities.

A Transaction Caused a $15,000 Decrease in Both Total Assets