Question

down payment made at the time of hair purchase transaction is debited to.......
a)asset account
b)purchase account
c)hire vendor account
d)none of these

Answer 1

Answer:assest accountant

Explanation:

Thus, if a payment is made down, the entry is to debit the asset and credit Bank, there being no interest when payment is made on the signing of the contract.

Answer 2

Option (c). Down payment made at the time of hair purchase transaction is debited to hire vendor account.

Characteristics of "Hire-purchase system":

• In a hire-purchase system, the buyer is allowed to hire the goods for monthly payments. These monthly payments consist of principal and interest.
• The possession of the goods is transferred immediately but the actual ownership is transferred when the last payment is made.
• The person who obtains the goods from the hire vendor under the hire purchase agreement and agrees to make monthly payments is called the hire purchaser.
• Down payment made at the time of hair purchase transaction is debited to hire vendor account. The journal entry for it is:

        Hire vendor a/c  dr.   xx

                             to bank a/c    xx