Question

A business received $600 cash from charge customers to apply on account. The effect of the transaction is an increase in an asset an_

Answer 1

When business receives $600 cash from customers there is an increase in an asset - i.e increase in cash balance.

Similarly there is also decrease in another asset i.e debtors balance. Charge customers are those who owe money to the business. They have debit balance. $600 cash when received is reduced from charge customers account - overall debtors balance is reduced.

Hence The effect of above transaction is an increase in an asset (cash) and decrease in an asset ( debtors)