During Fiscal 2016, Shoe Productions Recorded Inventory Purchases on Credit

Multiple Choice

During fiscal 2016, Shoe Productions recorded inventory purchases on credit of $337.8 million. The financial statement effect of these purchase transactions would be to:

A) Increase liabilities (Accounts payable) by $337.8 million
B) Decrease cash by $337.8 million
C) Increase expenses (Cost of goods sold) by $337.8 million
D) Decrease noncash assets (Inventory) by $337.8 million
E) Both A and D