Question: If a company uses $1,300 of its cash to purchase supplies, the effect on the accounting equation would be: Question 21 options: Assets increase $1,300 and liabilities decrease $1,300. One asset increases $1,300 and another asset decreases $1,300, causing no effect. Assets decrease $1,300 and equity decreases $1,300. Assets decrease $1,300 and equity increases $1,300. Assets increase $1,300 and liabilities increase $1,300.