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After the sale, The Melville Company paid off the loan to First National Bank. What is the effect of the sale and the payoff of the loan on the accounting equation?
a. assets increase $20,000; liabilities decrease $15,000; owner's equity increases $5,000
b. assets increase $5,000; liabilities decrease $15,000; owner's equity increases $20,000
c. assets increase $60,000; liabilities decrease $15,000; owner's equity increases $20,000
d. assets increase $20,000; liabilities decrease $15,000; owner's equity increases $35,000
2. The total assets and the total liabilities of a business at the beginning and at the end of the year appear below...
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