Respuesta :
If a company purchases equipment costing $4,000 on credit, the effect on the accounting equation would be assets increase by $4000 and liabilities increase by $4000
If We purchase an Asset on credit there could be two accounts affected by the purchase: One is Asset A/c and another one is creditors A/c The asset is a Real A/c and Creditor is Personal A/c. According to the Golden Rule of Accounting For All Real Accounts: Debit what comes in, Credit What goes out; For All Personal Accounts: Debit the Receiver, Credit The Giver.
Therefore journal entry of the above equation will be
Asset A/c Dr $4000
To Creditor A/c $4000
A credit purchase, or to buy something “on credit,” is to buy something you get hold of today that you may pay for later. As an example, whilst you swipe a credit card, your monetary organization pays for the goods or services up front, then collects the finances from you later.
Learn more about Asset here brainly.com/question/25746199
#SPJ4
