Which transaction has the effect when ABC purchases

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Problem 1: ABC purchases $1,500 of inventory on account. This transaction has the following effect:

A. Non-cash assets and liabilities both increase; income statement expenses increase, and earned capital on the balance sheet decreases

B. Non-cash assets increase and cash decreases, with an expense on the income statement

C. Non-cash assets and liabilities both increase; income statement expenses increase

D. Non-cash assets and liabilities both increase; no income statement effect.

Reference no: EM132835894

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