Home Theater Advantage Sells Audio Equipment

Multiple Choice

Home Theater Advantage sells audio equipment.Home Theater Advantage acquired 50 speakers from a manufacturer at a cost of $200 per speaker and purchased the speakers on account.The effect of this transaction on Home Theater Advantage would be to

A) increase inventory by $10,000 and increase capital by $10,000.
B) increase inventory by $10,000 and decrease capital by $10,000.
C) increase inventory by $10,000 and decrease cash by $10,000.
D) increase inventory by $10,000 and increase accounts payable by $10,000.
E) increase inventory by $10,000 and decrease accounts payable by $10,000.