From the following transactions, briefly explain the dual aspects of every transaction:

  1. Stock ofRs. 170,000 purchased from the supplier
  2. Assets ofRs. 225,000 purchased

Asked by Topperlearning User | 9th Jun, 2016, 12:41: PM

Expert Answer:

  1. Stock of Rs. 170,000 purchased from the supplier

    Here, the business is receiving stock, and therefore stock account has been debited. On the other hand, cash is paid to the supplier, and hence cash account is credited.

  2. Asset of Rs. 2,25,000 purchased

    Here, the business is receiving an asset, and therefore assets account is debited. On the other hand, cash is paid, and hence cash account is credited.

Answered by  | 9th Jun, 2016, 02:41: PM