Post Utme Joseph Ayo Babalola University 2025 Accounting Question 6

Practice objective / multiple choice question 6 from the 2025 Post Utme Joseph Ayo Babalola University Accounting examination.

Post Utme Joseph Ayo Babalola University 2025 Accounting Objective / Multiple Choice
Question 6 POST_UTME_JOSEPH_AYO_BABALOLA_UNIVERSITY • 2025 • ACCOUNTING • objective

A company uses the double entry system to record transactions. The company's ledger shows the following balances: Cash 10,000, Accounts Payable 5,000, and Common Stock 20,000. If the company purchases office supplies for 1,000, what is the effect on the accounting equation?

Answer Options

A. Assets increase by 1,000, Liabilities increase by 1,000, and Equity increases by 1,000
Correct Answer B. Assets increase by 1,000, Liabilities decrease by 1,000, and Equity increases by 1,000
C. Assets decrease by 1,000, Liabilities increase by 1,000, and Equity decreases by 1,000
D. Assets decrease by 1,000, Liabilities decrease by 1,000, and Equity decreases by 1,000
Correct Answer
B
Correct Option:
Assets increase by 1,000, Liabilities decrease by 1,000, and Equity increases by 1,000

About This Question

This is Post Utme Joseph Ayo Babalola University 2025 Accounting Question 6. It is one of the objective questions from the 2025 Post Utme Joseph Ayo Babalola University Accounting examination.

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