If a Company Paid $38,000 of Its Accounts Payable in Cash

question 178

Multiple Choice

If a company paid $38,000 of its accounts payable in cash, what was the effect on the assets, liabilities, and equity?

• A) Assets would decrease $38,000, liabilities would decrease $38,000, and equity would decrease $38,000.
• B) Assets would decrease $38,000, liabilities would decrease $38,000, and equity would increase $38,000.
• C) Assets would decrease $38,000, liabilities would decrease $38,000, and equity would not change.
• D) There would be no effect on the accounts because the accounts are affected by the same amount.
• E) None of these.

---

Definitions:

Qualities of Friendship

Characteristics or attributes that are generally perceived as conducive to forming and maintaining friendships, such as trust, loyalty, honesty, and mutual respect.

Define Friendship

The emotional and voluntary interpersonal relationship between two or more individuals, characterized by mutual affection, care, support, and the desire for each other's company.

Passion-based Intimacy

An emotional closeness that stems from shared enthusiasm or deep interest in particular activities or topics.

Friendship-based Intimacy

The closeness and bond that develop from deep friendship, characterized by trust, affection, and mutual respect.