A Business Purchases Equipment by Paying $8,000 in Cash and Issuing

question 92

Multiple Choice

A business purchases equipment by paying $8,000 in cash and issuing a note payable of $12,000.Which of the following journal entries would be recorded?

• A) \[\begin{array} { | l | r | r | }
• \hline \text { Equipment } & 20,000 & \\
• \hline \text { Notes payable } & & 12,000 \\
• \hline \text { Cash } & & 8,000 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | r | r | }
• \hline \text { Cash } & 8,000 & \\
• \hline \text { Notes payable } & 12,000 & \\
• \hline \text { Equipment } & & 20,000 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | r | r | }
• \hline \text { Cash } & 8,000 & \\
• \hline \text { Notes payable } & 4,000 & \\
• \hline \text { Equipment } & & 12,000 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | l | r | r | }
• \hline \text { Equipment } & 8,000 & \\
• \hline \text { Notes payable } & 4,000 & \\
• \hline \text { Cash } & & 12,000 \\
• \hline
• \end{array}\]

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