1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Vinvika [58]
3 years ago
12

A company pays $1,900 for supplies previously purchased on account. Indicate the amount of increases and decreases in the accoun

ting equation.
Business
1 answer:
ad-work [718]3 years ago
5 0

Answer:

Assets decreases by $1,900 while liabilities also decreases by $1,900.

Explanation:

Accounting equation shows that the assets of a company is equal to the addition of its liabilities and shareholders' equity. This is stated mathematically as follows:

Assets = Liabilities + Shareholders' equity ................................. (1)

The aim of the accounting equation is to ensure that the balance sheet is always balanced, that is, a change in one of the components of the accounting equation must result in a corresponding change in another component of the accounting equation. This ensures the accounting equation always balance.

in the question, purchasing an item on account means that the item was purchased on credit i.e. without paying for it immediately. This makes the supplier a creditor to the company and creditor is one of the components of liabilities in the accounting equation. The payment of $1,900 to the creditor implies a decrease in the liabilities by $1,900.

In addition, cash is one of the components of assets in the accounting equation stated above. Therefore, the payment of $1,900 by the company to the creditor/supplier reduces assets by $1,900.

Based on this information, the accounting equation (1) above can be restated as follows:

Assets - $1,900  = Liabilities - $1,900 + Shareholders' equity ............ (2)

This shows that assets decreases by $1,900 while liabilities also decreases by $1,900.

To test that the accounting equation always balance, equation (2) can be solved and we will obtain equation (1) back again as follows:

Assets - $1,900 + $1,900 = Liabilities + Shareholders' equity

Since - $1,900 + $1,900 = 0, we have equation (1) back again as follows:

Assets = Liabilities + Shareholders' equity

I wish you the best.

You might be interested in
Improving quality seems to be a strategic weapon in gaining market share. However, improving quality entails allocation of resou
mezya [45]

Answer:

A. prevention costs

Explanation:

4 0
3 years ago
Plz helpppp
umka21 [38]

Answer:

10 units

Explanation:

Break even point = Fixed cost/ contribution margin per unit

For Jenny,

Fixed costs = $60

contribution margin per unit= selling price - variable cost

Selling price =$15

Variable cost =$9

Contribution margin per unit

= $15 - $9

=$6

Breakeven points = $60/$6

=10 units

4 0
3 years ago
An example of a company connecting with customers to add value in its package redesign strategy is Blank______.
kakasveta [241]

An example of a company connecting with customers in its package redesign strategy is creating a resealable package in response to consumer habits.

<h3>What is a redesign strategy?</h3>

A redesign strategy outlines which best practices should be employed first and which should be avoided in order to achieve the goals of the redesign endeavor.

Steps to a successful redesign of business processes:

  • Set precise objectives.
  • Prioritize each business process after identifying it.
  • Make data collection and processing a regular part of your working day.
  • A single workflow.
  • Give authority to those in charge of processes.
  • Single-source information collection.

In order to build the most effective product, the design strategy applies the tactical thinking of a company strategy to the needs of the user. Through innovative applications geared toward the end user, the convergence of business strategy and design thinking accomplishes long-term objectives.

To know more about design strategy refer to: brainly.com/question/14506200

#SPJ4

5 0
2 years ago
This information relates to Wildhorse Co..
noname [10]

Answer:

Wildhorse Co.’s books

Perpetual Inventory System

Date                  Account                                        Dr.              Cr

5 April                 Merchandise Inventory       $28,200

                              Accounts/ Notes Payable                                $28200

Purchased merchandise from Carla Vista Company for $28,200, terms 2/10, n/30.

6 April                 Freight Charges                  $ 710

                                Cash                                                   $ 710

Paid freight costs of $710

7 April                    Equipment                    $ 33200

                               Accounts Payable                              $ 33,200

Purchased equipment on account for $33,200.

8 April                 Accounts Payable             $3800

                                Merchandise Inventory                     $ 3800

Returned $3,800 of April 5 merchandise

15 April                  Accounts Payable               $ 24,400

                                 Purchases Discount                              488

                                 Cash                                                       $ 23,912

Paid the amount due ($28,200- $3800= $24,400)

2% of $ 24,400= $ 488

b. Payment of balance due on May 4 instead of Apr 5

4 May                Accounts Payable             $ 24,400

                                   Cash                                                  $ 24,400

4 0
3 years ago
At a product's equilibrium price:
just olya [345]

Answer:

The answer is. C) any buyer who is willing and able to pay the price will find a seller for the product.

Explanation:

At a product's equilibrium price, the quantity demanded of the product equals the quantity supplied of the product. So that means that there will always be a supplier willing to sell the product to any consumer who is willing to pay for that product.

7 0
3 years ago
Other questions:
  • Suppose that a worker in Country A can produce either 25 bananas or 5 tomatoes cach year. Country A has 200 workers. Suppose a w
    14·1 answer
  • In a response to public outcry over the Internal Revenue Service’s (IRS) extent and abuse of power, the Federal government has d
    8·1 answer
  • __________ refers to the location of the sport product, the point of origin for distributing the product, the geographic locatio
    8·1 answer
  • Help thanks yo *************************
    14·2 answers
  • Steve, the vice president of Ocher Inc., plans to introduce a retirement plan for all employees. George, the operations director
    15·1 answer
  • What time is it when you see this
    15·2 answers
  • At the beginning of the current accounting period Blazer Company had a $40,000 balance in its Finished Goods Inventory account.
    14·1 answer
  • A​ _____ is in​ top-down format and shows each level of​ design, its relationship to other​ levels, and its place in the overall
    9·1 answer
  • Criteria for recruitment of business administration department
    8·1 answer
  • In order for a liability to be classified as a current liability, it must be a debt that the company:.
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!