Journal Entry - Purchasing Goods

Inventory purchasedQ: What is the journal entry for the following?

Purchase goods from KJ Mehta for cash 5,000 Rupees

A: The journal entry would be:

Debit Purchases 5,000
Credit Cash/Bank 5,000

The above is for a periodic inventory system. For a perpetual inventory system we record:

Debit Inventory 5,000
Credit Cash/Bank 5,000

Make sure you know the difference between the perpetual and periodic systems! This is important for any accounting question about goods you bought or sold.

Hope that makes sense! Good luck!


Comments for Journal Entry - Purchasing Goods

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Journal Entry
by: Anonymous

Mr. A purchase desktop from B and donate to C. What journal should be made in the books of A?

by: Anonymous

Purchase A/c Dr.
To Cash

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