Question

Purchased a machine on December 7 for $24,000 cash. The machine has an estimated life of 4 years. Give the original entry for the purchase of the machine?

Answer 1

The original entry for the purchase of the machine would be a debit of $24,000 to Machine and a credit of $24,000 to Cash.

Step-by-step explanation:

The original entry for the purchase of the machine on December 7 for $24,000 cash would be to record an increase in the machine's value and a decrease in cash. This is done through the following journal entry:

Debit: Machine $24,000

Credit: Cash $24,000

This entry recognizes the acquisition of the machine as an asset and the outflow of cash to pay for it.