Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 4 - No. 4)
What is the effect of an increase in a current asset on the accounting equation?
Increases assets, decreases liabilities
Increases assets, increases equity
Increases assets, decreases assets
Decreases assets, decreases equity
Explanation
An increase in a current asset usually requires a corresponding change in another asset, leading to no overall change in liabilities or equity
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