Question

cy to Excel (OTE) One Time Left:0:10:18 Ryan Shackleford: Attempt 1 Х . Question 29 (2 points) During November, ABC, Inc. purchased office supplies for cash. The supplies will be used in November. What effect does this purchase transaction have on the accounting equation! Amets increase and stockholders' equity decreases O Auses increase and liabilities increase 18 Assets decrease and liabilities decrease There is no effect on the accounting to count increases while another asset account decres 21 Question 30 (2 points) Saved Which of the following is true concerning external official information Edera de record of the to make informed deciso 22 Extrema parily responsible for the properties of financial statements Question 31 (2 points) de o 9/13 - % 5 6 8 T > U O E T R F D H G

Answer 1

1) there is no effect on the accounting equation as one asset account increases while another asset account decreases.

purchased office supplies for cash.both office supplies and cash are current asset account.as supplies increased it gets debited and as cash decreases it gets credited.there will be no amount liabilities or equity section and therefore the accounting equation will have no effect on this transaction.

2) external users rely on the financial statements to help make informed decisions.

external users are the secondary user of financial statements.the primar user are internal user which is the owners,ivestors,management etc.. and the external users are the banks,suppliers,customers,governmentsetc.. . They are interested in financial information because their present and future is tied up with the success or failure of the business.for example the supplier need accounting information to assess the credit-worthiness of its customers before offering goods and services on credit. and the government need to know that the financial statements are prepared on accordance with the standards and regulations.