Journal Entry For Computer / Laptop Purchase

Here we will study about the Journal Entry for the purchase of computer or laptop which is a Fixed Asset / Non Current Asset and recorded on the balance sheet in Accounting.

There are two types of journal entries related to the purchase of computer / laptop from the point view of business.

1. Purchase Computer / Laptop For Office Use Journal Entry

If the purpose of purchasing computer / laptop is to use these in the office, then these become fixed assets / non current assets of the business.

When the business purchased computer or laptop for cash / cheque or check, then following entry is recorded as shown below:

                                     Computer a/c / Laptop a/c  XXX

                                                                                Cash a/c / Bank a/c XXX

                                               (Computer / Laptop Purchased For Cash / Check)

When the business purchased the computer or laptop on credit or on account, the following entry is recorded in the books of company’s business as shown below:

                                          Computer a/c / Laptop a/c  XXX

                                                                                  Accounts Payable a/c  XXX

                                                   (Computer / Laptop Purchased On Account)

Special Case: Owner Purchased Computer / Laptop For Personal Use Journal Entry

When the owner of the business purchased computer or laptop for his own personal use or private use and withdrew cash or cheque from business to make payment, then, this transaction is not related to business concern according to Separate Legal Entity Concept, so we record the following entry:

                                             Drawings a/c  XXX

                                                                   

                                                                    Cash a/c / Bank a/c XXX

      (Purchased Computer / Laptop For His Own Use And Withdrew Cash Or Check From Business )

2. Purchase Computer / Laptop For Resale Journal Entry

If the company’s business is to to sell the computers / laptops and not to use in the office, then these become goods for the business as these are purchased for resale purposes, then we treated computers / laptops as goods purchased and now Purchases Account is used instead of the Asset Account.

                                                        Purchases a/c  XXX

 

                                                                             Cash a/c / Bank a/c  XXX

                                                    (Goods Purchased For Cash / Check)

 

When computer or laptop purchased on credit or on account for resale purposes, then the entry is recorded as shown below:

                                                         Purchases a/c  XXX

                                                                               Accounts Payable a/c  XXX

                                                          (Goods Purchased On Credit)