Jack Tupp Auto Repair purchased equipment for 2500 It paid 5

Jack Tupp Auto Repair purchased equipment for $2,500. It paid $500 cash and signed a note for the remaining balance. lo properly record this transaction, Jack Tupp Auto Repair should debit Equipment, credit Cash for $500, and Select ] [ Select ] for Select ]

Solution

The journal entry is:

Equipment a/c..Dr$2500

To cash $500

To note payable $2000.

Hence to properly record the transaction;credit cash for $500 and credit note payable for $2000.