Class 11 Exam > Class 11 Questions > Journalise the following: purchased machinery...
Start Learning for Free
Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage?
Most Upvoted Answer
Journalise the following: purchased machinery for 20000 and paid 200 a...
Purchase of Machinery for 20000 with 200 Paid as Cartage
Journal Entry
When a business purchases machinery, it is considered a capital expenditure as it will benefit the business for more than one accounting period. In this case, the business has also paid 200 for the cartage of the machinery, which is an expense incurred to transport the machinery to the business premises. The journal entry for this transaction would be:
- Debit Machinery Account - 20000
- Credit Cash/Bank Account - 20000
- Debit Cartage Account - 200
- Credit Cash/Bank Account - 200
Explanation of the Journal Entry
The above journal entry can be explained as follows:
- The debit entry to the Machinery Account represents the purchase of the machinery for 20000. This account is a non-current asset account and will be recorded on the balance sheet as an asset.
- The credit entry to the Cash/Bank Account represents the payment made for the machinery. This account is a current asset account and will also be recorded on the balance sheet as an asset.
- The debit entry to the Cartage Account represents the expense incurred for the transportation of the machinery to the business premises. This account is an expense account and will be recorded on the income statement as an expense.
- The credit entry to the Cash/Bank Account represents the payment made for the cartage expense. This account is a current asset account and will also be recorded on the balance sheet as an asset.
Conclusion
It is important for businesses to record all transactions accurately in their accounting records. The above journal entry shows the correct way of recording the purchase of machinery and related cartage expense. This will help the business to keep track of its assets and expenses and provide a clear picture of its financial position.
Community Answer
Journalise the following: purchased machinery for 20000 and paid 200 a...
Machinery A/C dr.20000cartage A/C dr. 200To cash A/C. 20200 ..sorry...no proper presentation just follow entry...and not follow ..pattern
Attention Class 11 Students!
To make sure you are not studying endlessly, EduRev has designed Class 11 study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Class 11.
|
Explore Courses for Class 11 exam
|
|
Similar Class 11 Doubts
Top Courses for Class 11View all
Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage?
Question Description
Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? for Class 11 2024 is part of Class 11 preparation. The Question and answers have been prepared according to the Class 11 exam syllabus. Information about Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? covers all topics & solutions for Class 11 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage?.
Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? for Class 11 2024 is part of Class 11 preparation. The Question and answers have been prepared according to the Class 11 exam syllabus. Information about Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? covers all topics & solutions for Class 11 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage?.
Solutions for Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? in English & in Hindi are available as part of our courses for Class 11.
Download more important topics, notes, lectures and mock test series for Class 11 Exam by signing up for free.
Here you can find the meaning of Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? defined & explained in the simplest way possible. Besides giving the explanation of
Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage?, a detailed solution for Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? has been provided alongside types of Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? theory, EduRev gives you an
ample number of questions to practice Journalise the following: purchased machinery for 20000 and paid 200 as it's cartage? tests, examples and also practice Class 11 tests.
|
|
Explore Courses for Class 11 exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup