Doug's Doodle Shop, specializing in dog supplies, signs a contract with a pet groomer. Next month, the groomer will begin leasing a portion of Doug's store and provide grooming services. The signing of the contract. Multiple Choice has no effect on the accounting equation. increases assets. increases liabilities.

When Doug's Doodle Shop signs a contract with the pet groomer, it's essentially a future agreement to provide space and services starting next month. The mere act of signing the contract doesn't immediately involve any exchange of assets, liabilities, or equity. **Key Points:** - **No Immediate Transaction:** There's no exchange of cash, property, or any other resources at the time of signing. - **Future Obligations:** While the contract creates a future obligation (Doug will provide space and the groomer will pay rent), this obligation doesn't get recorded in the accounting books until it becomes actionable or until any exchanges occur. - **No Immediate Impact on Accounting Equation:** Since there's no current increase in assets or liabilities, the accounting equation remains unaffected at the time of signing. **Answer:** **has no effect on the accounting equation.**