Question

multiple choice question
which statement is correct regarding entering transactions into the accounting equation?

after recording a transaction, the total of the right side of the accounting equation must equal the total of the left side of the accounting equation.
if total assets are increased, then liabilities only are increased as well.
if one asset account is increased, then another asset account must be decreased in order for the left side of the accounting equation to be balanced.
if one account is credited, then at least one other account must be credited as well.

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Explanation:

The fundamental accounting equation is $\text{Assets} = \text{Liabilities} + \text{Owner's Equity}$. Every transaction must preserve this balance, so the sum of the left side (assets) must always equal the sum of the right side (liabilities + equity) post-transaction. The other options are incorrect: asset increases can come from equity increases, not only liabilities; an asset increase can be paired with a liability/equity increase (not just another asset decrease); and a credit to one account is typically paired with a debit to another account, not another credit.

Answer:

A. After recording a transaction, the total of the right side of the accounting equation must equal the total of the left side of the accounting equation.