When a company pays cash for inventory purchased on account in a previous period, it reports a(n):Multiple Choiceincrease in assets and increase in liabilitiesincrease in assets and decrease in liabilities.decrease in assets and increase in liabilities.decrease in assets and decrease in liabilities.
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So, the cash asset is decreasing because it is being used to pay off the liability. At the same time, the accounts payable liability is decreasing because it is being paid off. Show more…
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