Question

The purchase of supplies for cash will result in an _______________.

• A. Increase in cash and a decrease in capital
• B. Increase in cash and an increase in supplies
• C. Increase in supplies and a decrease in cash
• D. Increase in equipment and an increase in capital

Answer 1

The correct option is C Increase in supplies and a decrease in cash

As supplies are purchase therefore, the balance of supplies will increase and the balance od cash will decrease.