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Question

The periodic total of purchase day book is posted to ______.


A
Debit side of purchase A/c
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B
Debit side of trading A/c
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C
Credit side of creditors A/c
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D
Credit side of sales A/c
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Solution

The correct option is A Debit side of purchase A/c
Purchase is a nominal account and is an expense. 
As per nominal account rule, all expenses and losses are debited. 
Purchase book is one of the subsidiary books which is used for the purpose of recording the merchandise the enterprise deals is purchased on credit. 

The source documents for recording entries in the purchase book are invoices or bills received from the suppliers of goods. 
The total of purchase day book is posted to the debit of purchases account to indicate receipt of goods.

Accountancy

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