The purchase of a motor car on credit from Toy Automotive Company for use in a firm should be recorded as_?

Option C is the right answer

this like buying any assets and should be has depreciation and the recording will be debit / car credit / company seller.

The Answer is C because Increase in Asset and liability.

Dr. Motor vehicle Cr. Accounts payable (when Purchased) Dr. Accounts Payable Cr. Toy Automotive Company (When Recording Invoice)

The answer is (C) Debt: Motor vehicle Cridet: Toy Automotive Company

(C) Dr. Motor vehicle Cr. Toy Automotive CompanyAsset is purchased on credit, hence a creditor (liability) should be created.

Answer A is ruled out because it is not a maintenance expense

The use of purchases as a ledger title is vague and rules answer B outAnswer D is ruled out because it is not a cash expense.

(C) Dr. Motor vehicle Cr. Toy Automotive Company

B) Dr. Purchases Cr. Toy Automotive Company

Whether purchase at credit or cash it will be a purchase and hence should appear in purchases

c..............................

It's specifically identified as Motor Car purchased on CREDIT Basis,

Therefore, following entry shall be passed;

Debit Asset (Motor Car)

Credit Toy Automotive Company

Later upon payment

Debit Toy Automotive Company

Credit Cash