If a Company Uses $1,300 of Its Cash to Purchase

Multiple Choice

If a company uses $1,300 of its cash to purchase supplies, the effect on the accounting equation would be:

A) Assets decrease $1,300 and equity decreases $1,300.
B) Assets increase $1,300 and liabilities decrease $1,300.
C) Assets increase $1,300 and liabilities increase $1,300.
D) One asset increases $1,300 and another asset decreases $1,300, causing no effect.
E) Assets decrease $1,300 and equity increases $1,300.