Asked by Jennifer Osorio on May 06, 2024
Verified
In which journal would a cash purchase of inventory be recorded?
A) Purchases journal
B) General journal
C) Cash payments journal
D) None of these answer choices are correct.
Cash Purchase
A transaction where goods or services are bought and paid for with physical currency at the time of purchase.
Inventory
Inventory encompasses the raw materials, work-in-progress goods, and the finished products that a company holds with the intention of selling them to earn revenue.
- Learn about the various transactions inscribed in dedicated journals.
Verified Answer
AM
Arjela MustajMay 11, 2024
Final Answer :
C
Explanation :
A cash purchase of inventory would be recorded in the cash payments journal, which is used to record all payments made by the company, including purchases made with cash. The purchases journal is used to record credit purchases of inventory. The general journal is used for adjusting entries and other transactions not recorded in other specialized journals.
Learning Objectives
- Learn about the various transactions inscribed in dedicated journals.