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What is the purchase of equipment on credit recorded by?
A debit to equipment and a credit to liability
Can you write off the purchase of used equipment on your taxes?
Yes, you can typically write off the purchase of used equipment on your taxes as a business expense, which can help reduce your taxable income.
What is the best way to utilize borrowed money to purchase assets that will increase wealth, rather than liabilities that will decrease it?
The best way to use borrowed money to increase wealth is to invest in assets that have the potential to grow in value over time, such as real estate, stocks, or a business. Avoid using borrowed money to purchase liabilities like cars or luxury items that do not generate income or appreciate in value.
Who should the cardholder contact to increase the single purchase limit on the purchase card?
The Approving Officer (AO) or Agency/Organization Program Coordinator (A/OPC)
Which companies provide security equipment for retail businesses?
Security such as burglar alarms are a common purchase for businesses. Oftentimes, security equipment such as alarms are best purchased through companies such as ADT.
If a company purchase equipment on account will the assets increase decrease or stay the same?
If the equipment is purchased on credit (on account) then the net assets will stay the same as the assets will increase by the same amount as the liabilities
Is purchase for resale is an expenses?
No. Purchases for resale is treated as current asset.Accounting entry:Step 1: Purchase of equipments for resale in cashDebit Equipments (Increase in asset)Credit Cash (Decrease in asset)Step 2: Resale of equipments in cashDebit Cash (Increase in asset)Credit Equipment (Decrease in asset)
Which describes the process by which assets or equipment decrease in value as an employer pays off the loan used to purchase the equipment?
Depreciation
What effect does the purchase of treasury stock have on total stockholders equity increase decrease or none stays the same?
decrease
Why can't all the balance of payments accounts be in surplus?
The balance of payments accounts cannot be in surplus because there is always a balance in economics. For example, if you used cash assets to purchase equipment, the equipment account will increase but the cash assets account will decrease.
What will increase asset and decrease liability?
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).
Open market purchase will result in?
increase in bank reserves and a decrease in the federal funds rate
Can a transaction that causes an increase in an asset also cause a decrease in another asset?
Yes. If you purchase a new desk, your furniture asset account would increase, and your cash asset account would decrease.
How would a decrease of coffee production affect distribution?
It would increase the price of coffee available to purchase in shops.
What is the effect on total assets of the purchase of land for cash?
An increase in Land and a decrease in cash, total effect is zero.
What are the effects on the accounting equation from the purchase of a short-term investment?
The purchase of a short-term investment typically results in an increase in assets (cash decreases, and the investment account increases). The accounting equation remains balanced as the decrease in cash is offset by the increase in the investment account, maintaining the equality of assets, liabilities, and equity.
If a company purchase equipment on account What is the assets here?
The asset account will be Equipment. You will debit this account to increase its value. The credit side of this transaction will be Accounts Payable. This transaction will increase the value of Accounts Payable, as well.
