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State two transactions which increase and decrease only in the value of assets in a business ...\

i cant understand this question. Please gimme the answers. PLEeEEEEEEEEEEase !!!

2007-12-09 21:07:17 · 1 answers · asked by Aki Kwai 1 in Business & Finance Corporations

1 answers

One example:
When you buy an asset. You'd:
Dr Fixed Asset xxx
Cr Cash xxx

Another example:
When you pay for a prepaid expense, like an insurance policy: You'd:
Dr Prepaid insurance xxx
Cr Cash xxx

In both cases, you decrease and increase assets in the basic equation Assets - Liabilities = Owner's equity

2007-12-09 21:15:47 · answer #1 · answered by Sandy 7 · 1 0

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