On March 8, Black Candy Company bought supplies on account from the Arcade Fire

Question

On March 8, Black Candy Company bought supplies on account from the Arcade Fire Company for $550. Black Candy Company incorrectly debited Equipment for $500 and credited Accounts Payable for $500. The entries have been posted to the ledger. the correcting entry should be:

Answer

Supplies................................................................................... 550
                Accounts Payable................................................................                 550

Supplies................................................................................... 550
               Accounts Payable................................................................                 500
               Equipment..........................................................................                   50

Supplies................................................................................... 550
                Equipment..........................................................................                 550

Supplies................................................................................... 550
               Equipment..........................................................................                 500
               Accounts Payable................................................................                   50

Supplies................................................................................... 550
                Accounts Payable................................................................                 550

Supplies................................................................................... 550
               Accounts Payable................................................................                 500
               Equipment..........................................................................                   50

Supplies................................................................................... 550
                Equipment..........................................................................                 550

Supplies................................................................................... 550
               Equipment..........................................................................                 500
               Accounts Payable................................................................                   50

Explanation / Answer

Correct Entry should be

Supplies a/c .................................Dr 550

To Equipment 500

To accounts payable 50

( Being mistake rectified )

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