A business purchased office furniture for $1500 paying $1000 cash and owing $500 to be paid the following month.The debit and credit entries are:

Question

Quizplus · Accepted Answer

The business purchased office furniture for $1500. Out of this, $1000 was paid in cash and the remaining $500 was owed to be paid the following month. Therefore, the debit entry should be for office furniture for the full amount of $1500. The credit entries should be for cash (the amount paid upfront) for $1000 and accounts payable (the amount owed) for $500. Therefore, option A is the correct choice.

A Business Purchased Office Furniture for $1500 Paying $1000 Cash