Question

Carl Cornfield made up the following balance sheet after one year in business. Assets Liabilities and Owner's Equity Cash $5,000 Accounts Payable $3,500 Equipment $5,000 Owner's Equity: Investment $6,500 Total $10,000 Total $10,000 Carl decides to buy some special equipment for $750. His cash line will now be and his equipment line will now be

Answer 1

I think the correct answer is 4,250 and 5,750

why? asset cash is 5,000 and equipment is 5,000. if he is buying 750 in equipment then the cash he has goes down which makes 5000 go to 4,250 and then equipment goes up since he bought more so 5,750

ANSWER: HIS CASH LINE WILL NOW BE $4,250 AND HIS EQUIPMENT LINE WILL NOW BE $5,750