A company purchases inventory worth $5,000 by paying $2,000 in cash and the remainder on credit. How does this transaction affect the accounting equation? A company purchases inventory worth $5,000 by paying $2,000 in cash and the remainder on credit. How does this transaction affect the accounting equation? Increases liabilities and increases owner's equity. Increases assets and increases liabilities. Increases assets and increases owner's equity. Increases assets and decreases liabilities