Question

Cash paid on signing of the agreement under instalment system is debited by the purchaser of goods to :
(A) Asset Account
(B) Purchases Account
(C) Vendor's Account
(D) None of these​

Answer 1

Answer:

b purchase account

Explanation:

option b is your answer

Answer 2

(B) Cash paid at the time of signing the agreement under the deferred payment system is debited by the purchaser of goods to Purchases Account.

Explanation:

• A vendor, also named as supplier, is one that sells something.
• A sale is a deal between two or more parties, i.e. a purchaser and a supplier, in which commodities or services are reciprocated for money or other assets.
• A general ledger is an account that collects the inventory investments of a business is named a Purchase account.
• It is a short-term account utilized at periodic inventory system to save the purchases of merchants for resale.
• So the Cash debited by the purchaser of goods goes and gets credited into Purchases Account initially.

Hence Cash paid at time of signing agreement under the deferred payment system is debited by the buyer of goods to a Purchases Account.