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WAEC Financial Accounting 1992 Question 10

Question 10

Double Entry and the Ledger

Abdul paid off his indebtedness to John by cash. The accounting entries in Abdul's books are: debit

  1. A.Cash account, credit John's account
  2. B.Cash account, credit Debtors account
  3. C.John's account, credit Cash account
  4. D.John's account, credit Bank account
  5. E.Abdul's account, credit John's account.
Show the answer and explanation

Answer: C (John's account, credit Cash account)

Explanation

Paying a creditor in cash: debit the creditor (John), credit cash.