Purchased Supplies On Account Effect On Assets
Purchased supplies on account effect on Assets is that these are increased after the purchase. So, we debit supplies account and credit Accounts Payable Account and hence as a result total assets on asset side on the Balance Sheet increase. Similarly, liabilities & equity side also increases with the same amount but both sides of Balance sheet remain same in total monetary value. It also means that both asset and Liabilities & Equity sides of the Accounting Equation increase with the same amount but the total of both sides remain the same. Let’s us take an example of purchased office supplies on account Rs. 5000 from Mr. A a nd its effect on accounting equation. Purchased Supplies On Account Debit Or Credit The Journal Entry is shown below: Office Supplies a/c 5000 ...