Luxton Ltd

question 263

Multiple Choice

Luxton Ltd.signed a $378,000,5-year note payable to buy a new machine.Luxton paid $6,000 cash for transportation of the machine and $900 cash for installation costs.What is the overall effect of this transaction on the accounting equation?

• A)Total liabilities increase $384,900.
• B)Machinery,an asset,increases $378,000.
• C)Total assets increase $378,000.
• D)Total liabilities increase $371,100.

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Definitions:

Concealment

The act of hiding or withholding information or facts intentionally.

Nondisclosure

Refers to the act of not sharing certain information that is usually confidential or proprietary.

Assertion

A confident and forceful statement of fact or belief.

Unintentional

An action or outcome occurring without deliberate intent or plan.