Journal Entries: Business Formation Example Video Lessons

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Problem: The purchase of office equipment at a cost of $3,200 by an immediate payment of $700 and agreement to pay the balance within 60 days is recorded by: a. A debit of $700 to Office Equipment, a debit of $2,500 to Accounts Receivable, and a credit of $3,200 to Accounts Payable. b. A debit of $3,200 to Office Equipment, a credit of $700 to Cash, and a credit of $2,500 to Accounts Receivable. c. A debit of $2,500 to Accounts Receivable, a debit of $700 to Cash, and a credit of $3,200 to Office Equipment. d. A debit of $3,200 to Office Equipment, a credit of $700 to Cash, and a credit of $2,500 to Accounts Payable.

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Problem Details

The purchase of office equipment at a cost of $3,200 by an immediate payment of $700 and agreement to pay the balance within 60 days is recorded by:

a. A debit of $700 to Office Equipment, a debit of $2,500 to Accounts Receivable, and a credit of $3,200 to Accounts Payable.

b. A debit of $3,200 to Office Equipment, a credit of $700 to Cash, and a credit of $2,500 to Accounts Receivable.

c. A debit of $2,500 to Accounts Receivable, a debit of $700 to Cash, and a credit of $3,200 to Office Equipment.

d. A debit of $3,200 to Office Equipment, a credit of $700 to Cash, and a credit of $2,500 to Accounts Payable.

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