Transactions Impacting a Company's Balance Sheet

Which Transactions Affect a Company's Balance Sheet?

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Question

Which of the following transactions will impact a company's balance sheet?

Answers

A. The payment of principal on a long-term loan

B. The sale of new common stock

C. Net income earned by a company

D. All of these answers

E. The purchase of equipment for cash D

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Explanations

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A. B. C. D. E.

Explanation

All of these answers are correct. Net income earned by a company and the sale of common stock will affect the equity of a company; the purchase of equipment for cash will affect two assets accounts (cash and long-term assets); the payment of principal of a long-term loan will affect the liabilities of a company.

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