Final answer:
In the general journal entry for a company purchasing equipment with cash, they will record a debit to the equipment account and a credit to the cash account, in line with double-entry bookkeeping.
Step-by-step explanation:
When a company purchases equipment for cash, the general journal entry recorded will include a debit to the equipment account and a credit to the cash account. This transaction is recorded because the company is acquiring a new asset, which is the equipment, and at the same time, they are reducing another asset, which is cash in hand.
To illustrate with journal entry notation:
- Debit: Equipment account (to record the acquisition of the new asset)
- Credit: Cash account (to reflect the outflow of cash or reduction in company's cash balance)
This represents a fundamental aspect of double-entry bookkeeping, where every transaction affects at least two accounts and the sum of debits must equal the sum of credits.