154k views
1 vote
On October 10, a company paid $12,000 to its suppliers, of which $2,000 was for supplies received on October 10 and $10,000 was for supplies received and recorded during September. The $12,000 payment would be recorded as_____________

1 Answer

4 votes

Final answer:

The $12,000 payment is split between a reduction in accounts payable for previous supplies and a current period expense for recently received supplies.

Step-by-step explanation:

Accounting is the process of recording, classifying and summarizing financial transactions.

It provides a clear picture of the financial health of your organization and its performance, which can serve as a catalyst for resource management and strategic growth.

In this case, the $12,000 payment made by the company on October 10 would be recorded in the company's financial records accordingly.

Since $10,000 was for supplies received during September, it would be recorded as a reduction in accounts payable for those goods previously received and recorded.

The remaining $2,000, which is for the supplies received on the same day as payment, would be recorded both as an expense for the current period and as a cash outflow in the cash account.

User Kotarak
by
7.6k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.