The Purchase of Equipment Involving a Cash Down Payment and a Promise

question 161

Multiple Choice

The purchase of equipment involving a cash down payment and a promise to pay the balance in the future would include:

• A) a debit to Cash and a credit to Equipment.
• B) a debit to Note Payable and a credit to Cash.
• C) a credit to Cash and a credit to Note Payable.
• D) a debit to Cash and a debit to Note Payable.

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Definitions:

Dial Indicator

A precision measuring tool used to measure small distances or angles with high accuracy.

Wear Indicator

A feature on brake pads that produces a warning sound or visible cue to indicate the pads are significantly worn and need replacement.

Disc Brake Micrometer

A clamp-type instrument for making very precise measurements of disc brake rotor thickness.

Lateral Runout

The deviation or variation from true circular rotation of a component, such as a tire or disc, often resulting in vibration or wobble.