The Accounting Elements

Purchase of Inventory on Credit - the accounts affected are

• Bank, GST, Inventory

• Accounts Payable, GST and Inventory

• Accounts Payable, GST Clearing and Inventory

• ANY OF THE ABOVE

Paid wages - accounts affected

• Bank and Wages

• Dr Bank, Cr Wages

• Dr Wages, Cr Bank

• Dr Wages Dr GST Clearing Cr Bank

Paid Advertising

• Dr Bank, Cr Advertising, Cr GST Clearing

• Cr Bank, Dr Advertising, Dr GST Clearing

• Cr Advertising, Dr GST Clearing Cr Bank

• Cr Advertising, Cr GST Clearing Cr Bank

Credit Sale of Inventory

• Dr Bank and GST Clearing, Cr Sales, Inventory and Cost of Sales

• Dr Accounts Receivable, Cost of Sales; Cr GST Clearing, Sales and Inventory

• Dr Accounts Receivable, Cr GST Clearing, Sales

• Cr Accounts Receivable, Dr GST Clearing, Sales

Owner withdrew Inventory and Cash

• Dr Inventory, Dr Bank Cr Owners Equity

• Dr Inventory, Cr Bank Dr Capital

• Dr Drawings, Cr Bank and Inventory

• Cr Drawings, Dr Inventory and Bank

An increase in a Liability is a

• Debit

• Credit

An increase in an expense is a

• Debit

• Credit

There can never be a credit entry in an expense account

• True

• False

GST Clearing is always a Liability Account

• True

• False

Bank Overdraft is not a correct title

• True

• False