The Correct Entry to Record the Purchase of a Motor

question 7

Multiple Choice

The correct entry to record the purchase of a motor vehicle for $25 000 cash, plus 10% GST is which of the following?

• A) Debit motor vehicles $27 500; credit bank $27 500
• B) Debit motor vehicles $25 000; debit GST outlays $2500; credit bank $27 500
• C) Debit motor vehicles $27 500; credit bank $25 000; credit GST collected $2500
• D) Debit motor vehicles $22 500; debit GST outlays $2500; credit bank $25 000

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Definitions:

Reciprocity Norm

A social norm that suggests individuals should repay, in kind, what another has provided or done for them.

Role Transference

A psychological phenomenon where an individual assumes the attitudes, behaviors, or roles of another group or person, often seen in marketing when consumers identify with brand personalities.

Consubstantiation

The concept of acknowledging a shared essence among entities while still maintaining their distinct identities.

Liminality

A transitional state or phase in which a person or group is on the threshold between two different positions, conditions, or stages, often associated with rituals.