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ILLUSTRATION 1.17 Purchase of advertising on credit The two sides of the equation still balance at $17,800. Note that, although the expense increases, this is
ILLUSTRATION 1.17 Purchase of advertising on credit The two sides of the equation still balance at $17,800. Note that, although the expense increases, this is shown as a negative number because expenses reduce owner's equity. Expenses do not have to be paid in cash at the time they are incurred. When payment is made on the later date, the liability Accounts Payable will be decreased and the asset Cash will also be decreased (see transaction (8)]. U ILLUSTRATION 1.17 Purchase of advertising on credit The two sides of the equation still balance at $17,800. Note that, although the expense increases, this is shown as a negative number because expenses reduce owner's equity. Expenses do not have to be paid in cash at the time they are incurred. When payment is made on the later date, the liability Accounts Payable will be decreased and the asset Cash will also be decreased (see transaction (8)]. U
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