Prime entry books

This topic has 3 replies, 3 voices, and was last updated 8 years ago by John Moffat.

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February 7, 2018 at 6:46 pm #435738
miracle657
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A debit balance of $3,000 brought down on A Co’s account in B Co’s books
means that: –
A. A Co is owed $3,000 by B Co
B. B Co has sold $3,000 of goods to A Co
C. B Co is owed $3,000 by A Co
D. A Co has sold $3,000 of goods to B Co
Given correct answer is C..My question is that why B isn’t correct..How can we determine that it isn’t credit sale?
February 7, 2018 at 6:54 pm #435739
miracle657
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Sorry sir, i didn’t read answers carefully..i understood myself)) alternative B isn’t credit sale))C is a credit sale 🙂
February 7, 2018 at 11:38 pm #435778
suleymanabuzerli
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Where did you find this question?
I think that the answer is A, not C
February 8, 2018 at 10:23 am #435884
John Moffat
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sullymanabuzerli: Please don’t answer in this forum – it is the Ask the Tutor Forum, and you are not the tutor 🙂
The correct answer is certainly C.
In B’s books there is a debit balance on A’s account. Therefore B is owed money by A.
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