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Safari File Edit View History Bookmarks Develop Window Help mybusinesscourse.com Homework 2 Safari File Edit View History Bookmarks Develop Wi... Chegg.com E BusinessCourse E Menu Meredith Milholland- The accounting equation for Snoopy Enterprises is as follows Assets -Liaiies +Stockholders\' Equity 6 78910 ACCT20653:080-Intro to 480,000 $240,000 $240,000 Accounting-TTH 11 12 13 1415 Financial: Ch 1: Financial Accounting and Business Decisions If the company now purchases office supplies for $20,000 cash, the accounting equation will change to: 16 1718 19 20 Select one: 21 22 23 24 25 A. Financial: Ch 2: Processing Accounting Information Assets 480,000$220,000 + Liabilitie Stockholders\' Equity 260,000 26 27 28 29 30 31 3233 34 Financial: Ch 3: Accrual Basis of Business Accounting B. Labiiesders Saultsr Assets Un Finish attempt... $500,000 $240,000 + 260,000 Financial: Ch 4: Understanding Financial Statements C. Stockholders\' Equity $240,000 Assets Liabilities $480,000 = $240,000 + Financial: Ch 13: Analysis and Interpretation of Financial Statements Assets $500,000 = $260,000 + Managerial: Ch 1: Overview of Managerial Accounting $240,000

Solution

C. Assets $480,000 = liabilities $240,000 + equity $240,000.

office supplies are purchased for $20,000 in exchange of cash.

which means that asset is exchanged for asset.

Which means that asset balance increases and decreases at the same time by $20,000.

In other words the assets balance remains unaffected => $480,000 +$20,000 offfice supplies - $20,000 cash=>$480,000.

Liabilities and owner\'s equity are not part of this transaction and are unaffected.