Office equipment was purchased for $1,300 on account from Supplies-for-Less. The journal entry would include a:
A)debit to Office Equipment and a credit to Cash.
B)credit to Cash and a debit to Office Equipment Expense.
C)debit to Office Equipment and a credit to Accounts Payable.
D)debit to Accounts Payable and a credit to Cash.

Question

Quizplus · Accepted Answer

Office equipment was purchased on account, which means that the company did not pay cash at the time of the purchase. Therefore, the entry should include a debit to Office Equipment and a credit to Accounts Payable, which represents the amount owed to Supplies-for-Less. Option A is incorrect because the company did not pay cash. Option B is incorrect because Office Equipment Expense is usually used to record the cost of using equipment, not the cost of acquiring it. Option D is incorrect because it reverses the debit and credit accounts, which does not represent the transaction correctly.

Office Equipment Was Purchased for $1,300 on Account from Supplies-For-Less