To record the purchase of goods on credit:
This accounting problem is solved step by step below, with detailed explanations to help you understand the method and arrive at the correct answer.
ScanSolve AI Answer
To record the purchase of goods on credit:
Purchases is an expense account (or an account that increases inventory), and it is increasing, so it will be debited.
Dinesh is a creditor (a liability) because the goods were purchased on credit. Liabilities increase with a credit.
Step 1: Identify the accounts and amounts.
Purchases: ₹ 1,500
Dinesh (Creditor): ₹ 1,500
Step 2: Prepare the journal entry.
| Date | Particulars | L.F. | Debit (₹) | Credit (₹) |
| :-------- | :------------------ | :--- | :-------- | :--------- |
| January 3 | Purchases A/c Dr. | | 1,500 | |
| | To Dinesh's A/c | | | 1,500 |
| | (Being goods purchased from Dinesh on credit) | | | |
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The journal entry is:
$$\begin{array}{|l|l|r|r|} \hline \textbf{Date} & \textbf{Particulars} & \textbf{Debit (₹)} & \textbf{Credit (₹)} \\ \hline \text{January 3} & \text{Purchases A/c Dr.} & 1,500 & \\ & \quad \text{To Dinesh's A/c} & & 1,500 \\ & \text{(Being goods purchased from Dinesh on credit)} & & \\ \hline \end{array}$$
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