if-a-company-purchases-equipment-worth-50000-by-taking-a-loan-how-does-this-tran

Question

If a company purchases equipment worth $50,000 by taking a loan, how does this transaction affect the fundamental accounting equation?

Accepted Answer

Assets increase by $50,000; Liabilities increase by $50,000; Equity remains unchanged.

Answer

Assets increase by $50,000; Liabilities remain unchanged; Equity increases by $50,000.

Answer

Assets remain unchanged; Liabilities increase by $50,000; Equity increases by $50,000.

Answer

Assets increase by $50,000; Liabilities decrease by $50,000; Equity remains unchanged.