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WAEC Financial Accounting 2003 Question 10

Question 10

Departmental Accounts

The transfer of goods between departments is recorded by debiting

  1. A.the receiving department and crediting the giving department
  2. B.the giving department and crediting the receiving department
  3. C.Stock Account and crediting Trading Account
  4. D.Trading Account and crediting Purchases Account
Show the answer and explanation

Answer: A (the receiving department and crediting the giving department)

Explanation

The department receiving the goods is debited; the one giving them is credited.