7 Assume that the total assets, liabilities, and equity of the company is OMR 75000, OMR 30000 and OMR 45000 respectively. The company purchased OMR 6000 raw materials and paid OMR 3500 immediately. As per the agreement, remaining amount to be paid on 30th day from the date of purchase. Identify the effects of above transaction on different components of balance sheet. a. Assets of the company decrease by OMR 3500 and liabilities of the company increase by OMR 2500 b. Assets of the company increase by OMR 3500 and liabilities of the company increase by OMR 2500 c. Assets of the company increase by OMR 6000 and liabilities of the company increase by OMR 2500 d. Assets of the company increase by OMR 2500 and liabilities of the company increase by OMR 2500
7 Assume that the total assets, liabilities, and equity of the company is OMR 75000, OMR 30000 and OMR 45000 respectively. The company purchased OMR 6000 raw materials and paid OMR 3500 immediately. As per the agreement, remaining amount to be paid on 30th day from the date of purchase. Identify the effects of above transaction on different components of balance sheet. a. Assets of the company decrease by OMR 3500 and liabilities of the company increase by OMR 2500 b. Assets of the company increase by OMR 3500 and liabilities of the company increase by OMR 2500 c. Assets of the company increase by OMR 6000 and liabilities of the company increase by OMR 2500 d. Assets of the company increase by OMR 2500 and liabilities of the company increase by OMR 2500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
7
Assume that the total assets, liabilities, and equity of the company is OMR 75000, OMR 30000 and OMR 45000 respectively. The company purchased OMR 6000 raw materials and paid OMR 3500 immediately. As per the agreement, remaining amount to be paid on 30th day from the date of purchase. Identify the effects of above transaction on different components of balance sheet .
a.
Assets of the company decrease by OMR 3500 and liabilities of the company increase by OMR 2500
b.
Assets of the company increase by OMR 3500 and liabilities of the company increase by OMR 2500
c.
Assets of the company increase by OMR 6000 and liabilities of the company increase by OMR 2500
d.
Assets of the company increase by OMR 2500 and liabilities of the company increase by OMR 2500
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education