a. A vacant lot acquired for ($90,000,) on which there is a balance owed of ($30,000,) is

Question:

a. A vacant lot acquired for $$90,000,$ on which there is a balance owed of $$30,000,$ is sold for $$160,000$ in cash. What is the effect of the sale on the total amount of the seller’s (1) assets, (2) liabilities, and (3) owners’ equity?

b. After receiving the $$160,000$ cash in (a), the seller pays the $$30,000$ owed. What is the effect of the payment on the total amount of the seller’s (1) assets, (2) liabilities, and (3) owners’ equity?

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