A company paid 6,000 for supplies that were purchased earlier in the month on account. How does this transaction affect the accounting equation? A. subtract 6,000 from Accounts Payable and subtract 6,000 from Cash B. add 6,000 to Supplies Expense and add 3,000 to Cash C. add 6,000 to Supplies Expense and subtract 6,000 from Cash D. add 6,000 to Supplies and add 6,000 to Supplies Expense

The correct answer is **A. subtract 6,000 from Cash.**Here's why:The accounting equation is Assets = Liabilities + Equity. This transaction affects both assets and liabilities.* **Cash (Asset):** The company paid cash, meaning its cash balance decreases by 6,000.The other options are incorrect because:* **B & C:** Supplies Expense would only be affected when the supplies are *used*. This transaction simply reflects the *payment* for supplies already acquired.* **D:** Supplies were already recorded as an asset when they were purchased earlier in the month. This transaction doesn't affect the Supplies account. It only reflects the payment for those supplies.