Deerhoof Company purchases equipment for $2,700 and supplies for $400 from Milkman Co. for $3,100 cash. The entry for this transaction will include a

Question

Quizplus · Accepted Answer

The transaction involves the purchase of equipment and supplies by Deerhoof Company for cash from Milkman Co. The equipment account will be debited for $2,700 and the supplies account will be debited for $400 since these are assets acquired by Deerhoof. The cash account will be credited for $3,100 since this is the amount paid. There is no account payable in this transaction since Deerhoof paid in cash. Therefore, the correct option is D.

Deerhoof Company Purchases Equipment for $2,700 and Supplies for $400