When a person purchasing goods on credit he becomes a_________in the books of the seller?
Correct answer: A. Debtor
- A. Debtor
- B. Creditor
- C. Defaulter
- D. Offender
Explanation
In the seller’s books, a credit customer owes money for goods already received, so the customer is recorded as a debtor. The same person is a creditor only in the books of the party to whom that person owes money.
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About Accounting Principles
Accounting principles explain the rules used to record, classify and report business transactions. Coverage includes the accounting equation, double-entry system, accrual and cash bases, matching and prudence concepts, consistency, going concern, business entity, and the difference between capital and revenue items.
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