When companies purchase supplies on account, they have to create several journal entries to record the transaction in their financial statements. These entries change the balance of the fundamental ...

The expanded accounting equation builds upon the basic accounting equation's use of assets, liabilities and equity by incorporating additional components such as revenues, expenses and withdrawals.

Before any meaningful discussion can occur about the effect that a cash purchase of office supplies has on the accounting equation, it is important to understand what the accounting equation is and ...