Land originally purchased for $27,290 is sold for $76,131 in cash. What is the effect of the sale on the accounting equation? a. assets increase by $76,131; owner's equity increases by $76,131 b. assets increase by $76,131; liabilities decrease by $27,290; owner's equity increases $48,841 Oc. assets increase by $48,841; owner's equity increases by $48,841 Od. assets increase by $18,277; no change in liabilities; owner's equity increases by $76,131

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter15: Statement Of Cash Flows
Section: Chapter Questions
Problem 6DQ
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Land originally purchased for $27,290 is sold for $76,131 in cash. What is the effect of the sale on the accounting equation?
a. assets increase by $76,131; owner's equity increases by $76,131
b. assets increase by $76,131; liabilities decrease by $27,290; owner's equity increases $48,841
c. assets increase by $48,841; owner's equity increases by $48,841
d. assets increase by $18,277; no change in liabilities; owner's equity increases by $76,131
Transcribed Image Text:Land originally purchased for $27,290 is sold for $76,131 in cash. What is the effect of the sale on the accounting equation? a. assets increase by $76,131; owner's equity increases by $76,131 b. assets increase by $76,131; liabilities decrease by $27,290; owner's equity increases $48,841 c. assets increase by $48,841; owner's equity increases by $48,841 d. assets increase by $18,277; no change in liabilities; owner's equity increases by $76,131
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