A liability account is money owed by a company. Such as Accounts Payable and Notes Payable.
A transaction that would increase a liability account is if you purchased an item on account. This would increase either the Account Payable or Note Payable accounts.
A transaction that would decrease these are actual payments you make to the person/company you owe, hence lowering the balance of how much is owed.
For example, I purchase a truck costing $15,000, that transaction has increased my liability in notes payable. Once I begin making payments on that truck, each of those payments will decrease the liability.
The transaction would increase an asset account and increase a liability account?
yes accounting equation is asset = liability +own's equity. the transaction is a decrease on account recceivable of asset and an increase on capital of asset. therefore, the equation is balanced.
This is a difficult question to answer. I've been going through all transactions I can think of but none that will increase an asset and decrease a liability in the same transaction. Receiving cash payment for an account receivable will increase the asset of cash, but it also decreases the asset of AR. The purchase of equipment or supplies will do increase supplies or equipment but will either decrease the asset of cash or if bought on account will increase liability by increasing an account payable. Remember there's always an equal debit and credit with any transaction. The term debit or credit doesn't indicate which of the accounts are used. You can debit and credit on both sides of the accounting equation in one transaction. Assets increase by receiving money, supplies, property, or equipment, when any of these are increased with a debit then an opposite credit MUST occur. If you receive money for a purchase the asset of Cash increases, but then so does the Owners Equity account of Revenue. (this doesn't have anything to do with liabilities.) A liability is something your company owes, to decrease a liability a company makes a pay out in some form (usually cash), this will also decrease your assets (not increase).
Give me an example for what, the transaction would decrease an asset account and decrease the owner's equity account?
Give me an example for what, the transaction would decrease an asset account and decrease the owner's equity account?
The transaction would increase an asset account and increase a liability account?
yes accounting equation is asset = liability +own's equity. the transaction is a decrease on account recceivable of asset and an increase on capital of asset. therefore, the equation is balanced.
This is a difficult question to answer. I've been going through all transactions I can think of but none that will increase an asset and decrease a liability in the same transaction. Receiving cash payment for an account receivable will increase the asset of cash, but it also decreases the asset of AR. The purchase of equipment or supplies will do increase supplies or equipment but will either decrease the asset of cash or if bought on account will increase liability by increasing an account payable. Remember there's always an equal debit and credit with any transaction. The term debit or credit doesn't indicate which of the accounts are used. You can debit and credit on both sides of the accounting equation in one transaction. Assets increase by receiving money, supplies, property, or equipment, when any of these are increased with a debit then an opposite credit MUST occur. If you receive money for a purchase the asset of Cash increases, but then so does the Owners Equity account of Revenue. (this doesn't have anything to do with liabilities.) A liability is something your company owes, to decrease a liability a company makes a pay out in some form (usually cash), this will also decrease your assets (not increase).
account payable paid-off by arranging a new loan.
if you have a asset and you sale it and then money which you get pay as a liability so decreas in asset and decreas in liability occurs.
Give me an example for what, the transaction would decrease an asset account and decrease the owner's equity account?
Give me an example for what, the transaction would decrease an asset account and decrease the owner's equity account?
Give me an example for what, the transaction would decrease an asset account and decrease the owner's equity account?
Wut r u talking about
Yes. If you purchase a new desk, your furniture asset account would increase, and your cash asset account would decrease.
By paying the liability in part or in full.
It increases the amount owed, because creditors would be credited