Question

Purchase in trading account includes purchase of __________.

• A. machinery
• B. postage stamps
• C. stationery items
• D. trading goods

Answer 1

The correct option is D trading goods

Purchases is the amount of goods that the company has bought throughout the year. It also refers to the information as to the kind, quantity, quality and cost of goods bought that should be maintained. They are added to inventory.

Therefore, purchase of assets, postage stamps, stationery, etc. not being trading goods will not be included in purchases.