Journal Entry For Computer Software Purchase

A Computer Software is usually considered as an Intangible Asset in accounting as it has no physical existence. It needs operating systems to work effectively and hence it is usually installed on Windows, Mac OS, Linux and other operating systems to work effectively.

The journal entry to record for the purchase of computer software is shown below:

                                       Computer Software a/c  XXX

                                                                          Cash a/c / Bank a/c  XXX

                                           (Computer Software Purchased For Cash / Bank)

If computer software purchased on account or credit, then the entry is:

                               Computer Software a/c  XXX

                                                                   Accounts Payable a/c  XXX

                                               (Computer Software Purchased On Account)