In January, X Company purchased some equipment with $100,000 that it borrowed from a local bank. The accountant recorded the transaction as an increase in Inventories and an increase in Accounts Payable. As a result, on the January balance sheet, A. Cash was understated. B. Accounts Payable was understated. C. Total assets were understated. D. Inventories were overstated. E. Retained Earnings was overstated. F. Total liabilities were understated.