The Proper Journal Entry To Purchase A Computer On Account To Be Utilized Within The Business Would Be: | MCQ Solved!

Here is the Solution of Multiple Choice Question “The Proper Journal Entry To Purchase A Computer Or A Laptop Costing $1,350 On Account / Credit To Be Utilized Within The Business Would Be”

The correct answer is (b), as Purchased of Computer On Account Or Credit to be used in the business and not for resale purposes, is categorized under Office Equipment on balance sheet i.e., Purchased of a computer (a Fixed Asset) on account increased computer into the business, so, according to the Rules Of Debit And Credit, we debit office equipment account of $1,350 and credit Accounts Payable Account (a Current Liability) of $1,350 as liability to the business also increased. The company will pay for the computer bought on account and that time no cash is paid to the accounts payable or vendor.