Which of the Following Changes Describes the Purchase of $3,000

question 67

Multiple Choice

Which of the following changes describes the purchase of $3,000 of equipment financed by the issuance of a long-term note payable?

• A) Assets and shareholders' equity increase by $3,000.
• B) Assets and shareholders' equity decrease by $3,000.
• C) Assets and liabilities decrease by $3,000.
• D) Assets and liabilities increase by $3,000.

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Definitions:

Low-involvement Products

Goods or services that require minimal thought and effort from consumers before purchase due to their low cost or risk, such as everyday household items.

In-store Promotions

Marketing activities designed to stimulate sales directly within a retail location.

High-involvement Products

Products that carry a high purchase risk or are expensive, thus requiring more thought, research, and comparison from consumers before making a purchase decision.

Limited Risk

Exposures to potential losses that are confined or restricted in magnitude, often through strategies such as diversification or the use of financial instruments like options.