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WAEC Financial Accounting 2009 Question 20

Question 20

Double Entry and the Ledger

The purchase of a typewriter for office use for ¢2,000 is debited to

  1. A.creditors
  2. B.bank account
  3. C.purchases account
  4. D.equipment account
Show the answer and explanation

Answer: D (equipment account)

Explanation

A typewriter for office use is a fixed asset, so it is debited to the equipment account, not purchases (which is for goods for resale).