Neco 2018 Financial Accounting Question 2

Practice objective / multiple choice question 2 from the 2018 Neco Financial Accounting examination.

Neco 2018 Financial Accounting Objective / Multiple Choice Easy Difficulty

Question 2 NECO • 2018 • FINANCIAL_ACCOUNTING • objective

Explain how the purchase of equipment on credit for ₦50,000 affects the fundamental accounting equation. State the change in assets, liabilities and owners' equity.

A. Assets remain unchanged; Liabilities increase by ₦50,000; Owners' equity increases by ₦50,000.

B. Assets increase by ₦50,000; Liabilities remain unchanged; Owners' equity decreases by ₦50,000.

C. Assets increase by ₦50,000; Liabilities decrease by ₦50,000; Owners' equity remains unchanged.

Correct Answer D. Assets increase by ₦50,000; Liabilities increase by ₦50,000; Owners' equity remains unchanged.

Correct Answer

Correct Option:

Assets increase by ₦50,000; Liabilities increase by ₦50,000; Owners' equity remains unchanged.

This is Neco 2018 Financial Accounting Question 2. It is one of the objective questions from the 2018 Neco Financial Accounting examination.

Difficulty level: Easy .

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