hard · Investment Banking

If Zenith Logistics purchases $50,000 of equipment using cash, which of the following best describes the immediate impact on the three financial statements?

1. Cash decreases by $50,000 and PP&E increases by $50,000 on the balance sheet, with no income statement impact.
2. Total assets increase by $50,000.
3. Net income decreases by $50,000 due to the equipment expense.
4. Cash increases by $50,000 as the equipment is considered a source of funds.

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