Purchases book is meant for recording the _______ of goods.

Credit purchase

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Cash purchase

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Budgeted purchases

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Both (A) and (B)

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Solution

The correct option is B Credit purchase
Purchase book is a type of subsidiary book. The purpose of the purchase book is to record all the credit purchases of the business that are meant for resale.
This means that it does not record any cash purchase transactions. Such transactions will be recorded in the cash book.

Also, any purchases not meant for the purpose of resale are not recorded in the purchase book.

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Similar questions

Rectify the following errors:

(a)	Credit Sales to Mohan Rs 7,000 were recorded in purchases book.
(b)	Credit Purchases from Rohan Rs 900 were recorded in sales book.
(c)	Goods returned to Rakesh Rs 4,000 were recorded in the sales return book.
(d)	Goods returned from Mahesh Rs 1,000 were recorded in purchases return book.
(e)	Goods returned from Nahesh Rs 2,000 were recorded in purchases book.

Pass necessary Journal entries' to rectify the following errors:

(i) Goods returned to Mahima for Rs 5,000, entered into Sales Returns Book.

(ii) Kajol returned goods worth Rs 2,000, entered into Purchase Returns Book.

(iii) A credit purchase of Rs 3,000 from Ravina was recorded through Purchase Returns Book.

(iv) Goods worth Rs 1,160 returned to Karishma, were recorded in Purchase Book as Rs 1,106.

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