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1. When purchasing a product from a vendor, what type of account is affected? And when...

1. When purchasing a product from a vendor, what type of account is affected? And when you purchase a service what type of account is affected?

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Answer #1

When Purchasing a Product from a vendor on cash then the following account is affected

Purchased Account--------- Debit

Cash Account-------------Credit

When Purchasing a Product from a vendor on Account then the following account is affected

Purchased Account--------- Debit

Accounts Payable-------------Credit

When Purchasing a Services from a vendor on cash then the following account is affected. Say for example we have purchased a Insurances Services.

Insurance Services--------- Debit

Cash Account-------------Credit

When Purchasing a Services from a vendor on Account then the following account is affected. Say for example we have purchased a Insurances Services.

Insurance Services--------- Debit

Accounts Payable-------------Credit

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