The effects of the transaction on the accounting equation is decrease in both assets and liabilities
What is accounting equation?
The accounting equation shows that the total assets of a company is the sum of its equity and liabilities
assets=equity+ liabilities
By paying off $46,000 of its accounts payable in cash, the company's cash reduces, which means reduces by $1,000 and its liabilities would also go down by the same amount of $1,000
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