Question

Cash purchase and credit purchase calculation formula

Answer 1

Answer:

Credit Purchases Formula

Credit Purchases can be calculated by the following formula.

Credit Purchases= Closing Creditor Balance + Cash Paid – Opening Creditor Balance.

Creditor – Opening Balance = 30,000.

Creditor – Closing Balance = 50,000.

Cash Paid during Year= 80,000.

Answer 2

Cash Purchase = Total Purchase - Purchase Return

Credit Purchase = Opening Creditor Balance + Cash paid to them - Closing Creditor Balance

Purchase means something which we buy for fulfilling our basic needs or for fulfilling the requirements of business . Purchase can be made in two ways.

• These are cash purchase and credit purchase.
• Cash Purchase are those purchase which are done by giving cash at the time of purchase of the required commodity.
• Credit Purchase are those purchase for which no cash is given at the time of purchase or some amount of cash is given and rest will be payed afterwards.

Credit Purchase = Opening Creditor Balance  + Cash paid to them - Closing Creditor Balance

Cash Purchase = Total Purchase - Credit Purchase

 ( Total Purchase = Purchase - Purchase Return )