TransAm Mail Service Purchased Equipment for $2,500

question 154

Multiple Choice

TransAm Mail Service purchased equipment for $2,500. TransAm paid $400 in cash and signed a note for the balance. TransAm debited the Equipment account, credited Cash and

• A) nothing further must be done.
• B) debited the retained earnings account for $2,100.
• C) credited another asset account for $400.
• D) credited a liability account for $2,100.

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Definitions:

Corporate Responsibility

A business model where companies integrate social and environmental concerns in their operations and interactions with stakeholders.

Taxes

Mandatory financial charges or levies imposed by a government on individuals or entities to fund public expenditures.

Taxing Entities

Governments or jurisdictions with the authority to impose taxes on individuals, corporations, property, or transactions.

Merchandising Business

A business that buys goods in a ready-to-sell form and earns revenue by selling these goods to customers.