Multiple Choice
Your company bought a 30-second advertisement that aired during the Stanley Cup finals at a cost of $1.2 million.It is legally obligated to pay for the ad but has not yet done so.How does the purchase and use of the ad time affect your company's balance sheet?
A) It increases both assets and liabilities by $1.2 million.
B) It increases assets and decreases Shareholders' equity by $1.2 million each.
C) It does not affect the balance sheet.
D) It increases liabilities and decreases Shareholders' equity by $1.2 million each.
Correct Answer:
Verified
Correct Answer:
Verified
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