Chapter 2, Problem 4MC

The duality of effects can best be described as follows:

1. a. When a transaction is recorded in the accounting system, at least two effects on the basic accounting equa­tion will result.
2. b. When an exchange takes place between two parties, both parlies must record the transaction.
3. c. When a transaction is recorded, both the balance sheet and the income statement must be impacted.
4. d. When a transaction is recorded, one account will always increase and one account will always decrease.