Accord Corporation purchased land for $100,000 by making a c

Accord Corporation purchased land for $100,000 by making a cash payment of $30,000 and promising to pay the remaining amount in a later accounting period. What is the net effect of this transaction on Accord’s accounting equation?

A) assets increase by $100,000 and liabilities decrease by $30,000
B) assets increase by $100,000 and liabilities decrease by $70,000
C) assets and equity increase by $70,000
D) assets and liabilities increase by $70,000

ANSWER

D