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If a company purchases equipment costing $6,200 on credit, the effect on the accounting equation...

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Accounting

If a company purchases equipment costing $6,200 on credit, the effect on the accounting equation would be:

Multiple Choice

  • Assets increase $6,200 and liabilities decrease $6,200.

  • Liabilities decrease $6,200 and assets increase $6,200.

  • Equity decreases $6,200 and liabilities increase $6,200.

  • Equity increases $6,200 and liabilities decrease $6,200.

  • Assets increase $6,200 and liabilities increase $6,200.

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