Question

Do we record purchase of assets in purchase book?

Answer 1

Dear Student,

The purchase of assets is not recorded in the purchase book. Only the credit purchases of the goods(things in which a business deals) are recorded in the purchase book. Purchase of assets is not meant for resale and will be held for long-term to increase the profit-earning capacity of the business over various accounting periods. Hence, transactions related to purchase of assets cannot be recorded in the purchase book. Such transactions will be recorded in the journal proper.

Regards