Question

For each of the following items, give an example of a business transaction that has the described effect on the accounting equation:

* Increase an asset and increase a liability.
* Increase one asset and decrease another asset.
* Decrease an asset and decrease owner's equity.
* Decrease an asset and decrease a liability.
* Increase an asset and increase owner's equity.

Answer 1

Here's one:

Sell part of the business to another business.