The purchases day book is mainly used to record which transactions?
Correct answer: B. Credit purchases of goods for resale
- A. Cash purchases of office furniture
- B. Credit purchases of goods for resale
- C. Credit sales of goods to customers
- D. Cash payments made to suppliers
Explanation
The purchases day book records credit purchases of goods bought for resale. Cash purchases are entered in the cash book, and purchases of fixed assets are not recorded in this book.
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About Double Entry and Books of Prime Entry
Double entry records every transaction with equal debit and credit entries, based on the accounting equation and the classification of assets, liabilities, capital, income and expenses. Books of prime entry include the sales, purchases, returns and cash books, journal, and source documents used before transactions are posted to ledger accounts.
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