Journal entry for purchases

Answer 1

Example 1: A company purchased $12,000 equipment and paid in cash.

Debit Equipment $12,000 (Increase in asset)

Credit Bank $12,000 (Decrease in asset)

Example 2: A company purchased $12,000 equipment in credit.

Debit Equipment $12,000 (Increase in asset)

Credit Supplier $12,000 (Increase in Liability)

Example 3: A company purchased $12,000 equipment and paid in $10,000 Cast and $2,000 on credit.

Debit Equipment $ 12,000 (Increase in asset)

Credit Bank $ 10,000 (Decrease in asset)

Credit Supplier $ 2,000 (Increase in Liability)

Answer 2

debit purchases
credit cash