Question

"when you buy a piece of equipment for a company, what is the impact on the three financial statements?"

Answer 1

There are three main financial statements that can be affected by buying a piece of equipment for a company.

They are: (1) balance sheets; (2) income statements; and  (3) cash flow statements

Balance sheets show what a company owns and what it owes at a fixed point in time so buying a piece of equipment will show an increase in the  company’s assets and decrease in cash  Income statements which shows how much money a company made and spent over a period of time will report an increase in the expenses resulting to a lower net income.  

Cash flow statements which show a decrease in net cash due to buying of the equipment.