Question

A purchase book records _____________________.

• A. All type of purchase
• B. Only credit purchase of merchandise
• C. Only purchase returns
• D. Both cash and credit purchases of merchandise

Answer 1

The correct option is B Only credit purchase of merchandise

Purchase book records credit purchases of goods only. Whenever, goods are purchased, purchase account is debited. In all cases of purchases, goods come into business, so purchases account has to be debited. Monthly total of purchases book is posted to the debit of purchases account in the ledger.