If a company uses 50,000 of its cash to buy an asset, then: Multiple Choice assets and liabilities will be unchanged. assets will increase by 50,000 as will liabilities. assets will increase by 50,000 as will shareholders'equity. assets will decrease by 50,000 and liabilities will increase by 50,000

The correct answer is **assets and liabilities will be unchanged**.<br /><br />Here's why:<br /><br />The company is exchanging one asset (cash) for another asset (the purchased item). While the composition of the assets changes, the overall value of assets remains the same. Since no borrowing occurred and the company didn't issue new stock, liabilities and shareholders' equity are also unaffected. This reflects the basic accounting equation: Assets = Liabilities + Shareholders' Equity.<br />