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Question
When a entry involves two or more accounts it is called ________.
When a entry involves two or more accounts it is called ________.
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Solution
The correct option is C Compound entry
When a transaction is involving more than two accounts, entry is called a compound entry. Goods worth Rs.1000 is purchased on a discount of Rs.100 by paying cash of Rs.900 is an example of combined entry where accounting entry will be:
By Goods A/c Dr. Rs.1000 To Cash A/c Cr. Rs.900 To Cash discount A/c Cr. Rs.100
When a transaction is involving more than two accounts, entry is called a compound entry.
Goods worth Rs.1000 is purchased on a discount of Rs.100 by paying cash of Rs.900 is an example of combined entry where accounting entry will be:
By Goods A/c Dr. Rs.1000
To Cash A/c Cr. Rs.900
To Cash discount A/c Cr. Rs.100
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