Exercise 1-12 Identifying effects of transactions on the accounting equation LO P1 Select a transaction that effects the accounting equation as follows: Transaction Effects a. The company receives cash from an accounts receivable t. The company pays cash dividends to shareholders. c. The company made a cash withdrawal (dividend) to the owner. d. The company provides services for cash. e. The company pays cash toward an account payable. 1. The company purchases equipment on credit II Decreases an asset and decreases a liability Decreases an asset and decreases equity. Increases an asset and decreases an asset. Increases an asset and increases a liability, Increases an asset and increases equity. ences