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| 1. |
Total of the purchase invoices recorded in the Purchases Book in posted to debit side of the Purchases Account in the Ledger and creditedto the accounts of suppliers. Do you agree? Give reasons. |
| Answer» Solution :Yes. Purchase is an Expense Account THEREFORE, following the RULE ' Increase in expenses is debited and DECREASE credited.' PURCHASES Account is debited . Since, the Purchases Book contains records of CREDIT purchases, the Supplier's Account is credited following the rule applicable to LiabilityAccounts, i.e., ' Increase in liabilitiesis credited anddecrease debited.' | |