Ignoring GST, which of the following entries correctly records the purchase of land for $300 000 financed by a $100 000 cash deposit with the balance payable via a 20-year, 6% loan?

Question

Quizplus · Accepted Answer

Option A is incorrect as it only records the cash deposit and not the entire purchase amount. 
Option B is incorrect as it records the entire purchase amount as a cash payment, which is not the case since part of it is financed by a loan. 
Option D is incorrect as it only records the loan without taking into account the cash deposit. 
Option C is the correct entry as it records the full purchase price of $300,000 and acknowledges the $100,000 cash deposit and the $200,000 loan.

Ignoring GST, Which of the Following Entries Correctly Records the Purchase