Accounting for IGCSE & O level - Accounting Procedures (Section 27 - No. 30)
If a company sells goods on credit for $1,000, what is the impact on the accounting equation?
Assets and owner's equity increase by $1,000.
Assets and liabilities increase by $1,000.
Assets decrease by $1,000 and owner's equity increases by $1,000.
No change to the equation.
Explanation
Accounts receivable (asset) and revenue (owner's equity) increase.
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