7. The company paid P120,000 to purchase an equipment. The equipment will
be worth P130,000 in the next month, and was worth P110,000 last month.
How much is the net effect of this purchase to the assets of the company?
a. P0
b. P10,000 decrease
c. P10,000 increase
d. P120,000 increase
8. The company purchased land for P1,000,000 in exchange for a promissory
note for the whole amount payable after one year. The land is worth P800,000
for tax assessment purposes and will be worth P1,200,000 next year. How
much is the increase to the assets of the company due to this purchase?
a. P0
b. P800,000
c. P1,000,000
d. P1,200,000
worth P5,000, paid in cash. The