Effect of Purchase of Equipment on Financial Statements
On July 21, Lucky Tee, a custom apparel manufacturer, paid cash for the purchase of new screen printing equipment. This transaction affected the apparel company's financial statement elements as follows:
Assets and liabilities increased.
Assets and liabilities decreased.
Assets and owner’s equity increased.
Assets and owner's equity decreased.
Liabilities decreased and owner's equity increased.
Lucky Tee's financial statement elements were not impacted by this transaction.