What is the effect on the balance sheet of recording a $200 cash purchase of raw materials?

A. Assets increase by $200 and stockholders' equity does not change.
B. Assets and stockholders' equity do not change.
C. Assets increase by $200 and stockholders' equity increases by $200.
D. Assets decrease by $200 and stockholders' equity decreases by $200.


Answer: B

Business

You might also like to view...

Cash flows from operating activities, as part of the statement of cash flows, include cash transactions that enterinto the determination of net income

a. True b. False Indicate whether the statement is true or false

Business

Consumers who have no past experience with a product are more likely to judge it by its price

Indicate whether the statement is true or false

Business

What are the three conditions required by accounting standards in determining whether leases are treated as capital leases?

Business

When do state laws allow the owner of a trade secret to bring a civil lawsuit for misappropriation? Also discuss reverse engineering.

What will be an ideal response?

Business