The Richey Company purchased new equipment for $40,400 from Office Supplies, Inc., to be paid in 30 days. Which of the following is correct?
a. Equipment is increased by $40,400; Accounts Payable is decreased by $40,400.
b. Equipment is increased by $40,400; Accounts Payable is increased by $40,400.
c. Equipment is decreased by $40,400; Accounts Payable is increased by $40,400.
d. Equipment is increased by $40,400; Cash is decreased by $40,400.