Asked by Johnny Schinas on Jun 10, 2024
Verified
Susan flew to San Francisco on a business trip that will be reimbursed by her employer. The purchase price of the ticket was $800 and it was bought on account. The entry to record the transaction is:
A) debit Accounts Payable, $800; credit Travel Expense, $800.
B) debit Capital, $800; credit Accounts Payable, $800.
C) debit Travel Expense, $800; credit Accounts Payable, $800.
D) debit Travel Expense, $800; credit Cash, $800.
Accounts Payable
Money owed by a business to its suppliers or vendors for goods and services received but not yet paid for.
Travel Expense
Costs associated with traveling for the purpose of conducting business-related activities.
Purchase Price
The amount of money paid to acquire a product or service.
- Identify the correct way to record purchases and expenses, whether paid by cash or on account.
- Comprehend the nature of asset, liability, capital, revenue, and expense accounts including their normal balances.
Verified Answer
JD
Judith DelgadoJun 11, 2024
Final Answer :
C
Explanation :
The correct entry to record the purchase of a ticket on account for a business trip is to debit Travel Expense for the cost of the ticket, recognizing the expense, and to credit Accounts Payable, indicating the amount owed for the ticket purchase.
Learning Objectives
- Identify the correct way to record purchases and expenses, whether paid by cash or on account.
- Comprehend the nature of asset, liability, capital, revenue, and expense accounts including their normal balances.