I would like to see if someone can assist me in the proper way of identifying th

Question

I would like to see if someone can assist me in the proper way of identifying the journal entry for the following: Purchase a used car for $8,000 cash for the use in business. I have come up with the following: Account debited: (Basic Type)Asset; (Specific Amount) Cash; (Effect) Decrease; (Normal Balance) Credit Account credited: (Basic Type)Asset; (Specific Amount) Capital Equipment; (Effect) Increase; (Normal Balance) Debit Cash ($8,000) Captital Equipment $8,000 Can someone assist me please and tell me how you came up with the answer? Thank you. th

Explanation / Answer

Car A/c Dr $8000 To Cash A/c $8000 Being car purchased for business use. Effect is Increase of Asset Balances and decrese of Cash balance by specific Amt of $8000.The entry results in increase of fixed asset balance and decrea in current asset balance.

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