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Subjects>Law & Government>United States Government

What will increase one asset and decrease another asset?

Anonymous

∙ 13y ago

Updated: 11/10/2022

There are many transactions that do this. If you receive a payment on account from a customer, you increase Cash and decrease Accounts Receiveable. If you pay for raw materials or merchandise with cash, you increase Inventory and decrease Cash. You can also increase Fixed Assets and decrease Cash if you buy an asset with cash. Moving product from Raw Materials to Finished Goods Inventory is another example. Moving excess cash to an investment account does the same thing. When you make a sale, you decrease Inventory and increase Accounts Receivable.

Wiki User

∙ 13y ago

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Related Questions

Can a increase in one asset increase another asset?

Since both sides of the balance sheet (the Assets side and the Liabilities/Owners' Equity side) must have equal totals, an entry showing an increase in an asset must be balanced with an corresponding increase in a liability or a decrease in another asset.Generally, an increase in an asset (e.g., the acquisition of a new asset) means that either we have decreased another asset (e.g., cash) to pay for it, or we have incurred debt to acquire the asset (thereby increasing our liabilities).1) increase in one asset - corresponding decrease in another asset (e.g. we pay cash for new asset)2) increase in one asset - corresponding increase in a liability (e.g., we acquire an asset on credit)

What will increase one asset and decrease another asset with no effect on liability or owner s equity?

Purchase an asset on cash will increase the purchased asset while reduce the cash amount and no impact on liability or equity section.

What will increase one asset and decrease another asset without affecting liabilities or owner's equity?

Many cash transactions result in changes between asset accounts, such as the receipt of an accounts receivable, the outright purchase of an asset or the payment of a pre-paid expense.

What will cause a decrease in one liability and an increase in another liability?

Paying off one loan by getting another loan will decrease one liability and increase another.

If Total asset increase return on equity increase or decrease?

Increase in total assets generates increase in either one of liablity account or ultimately an equity account.

What will increase asset and decrease liability?

This is a difficult question to answer. I've been going through all transactions I can think of but none that will increase an asset and decrease a liability in the same transaction. Receiving cash payment for an account receivable will increase the asset of cash, but it also decreases the asset of AR. The purchase of equipment or supplies will do increase supplies or equipment but will either decrease the asset of cash or if bought on account will increase liability by increasing an account payable. Remember there's always an equal debit and credit with any transaction. The term debit or credit doesn't indicate which of the accounts are used. You can debit and credit on both sides of the accounting equation in one transaction. Assets increase by receiving money, supplies, property, or equipment, when any of these are increased with a debit then an opposite credit MUST occur. If you receive money for a purchase the asset of Cash increases, but then so does the Owners Equity account of Revenue. (this doesn't have anything to do with liabilities.) A liability is something your company owes, to decrease a liability a company makes a pay out in some form (usually cash), this will also decrease your assets (not increase).

Why population increase and decrease?

Populations increase and decrease because people leave one country (emigration) and enter another (immigration). A rise or fall in either the birth rate or death rate in a country can also cause populations to increase or decrease.

What transactions increase in one owner's equity equals decrease in another owner's equity?

Profits would increase owners equity, loss and drawing would decrease an owners equity.

One way of decreasing the equity of a business is to increase an asset?

no, increase liability

What occur when a drug reacts with another drug and food or dietry supplement to increase or decrease the effect of one of the substances?

Drug Interactions.

What is the meaning of inverse and direct relationship?

An inversely proportional relationship shows that as one variable of an equation increases, the other will decrease. A directly proportional relationship shows that as one variable increases, the other increases as well.

If one dimension decrease will the others increase or decrease?

the others will follow along with the first therefore the others will decrease

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