Question

choose the answer.
how would you journalize the transaction \bought merchandise on account\ in an expanded journal?
debit cash and credit accounts payable
debit accounts receivable and credit cash
debit purchases and credit accounts payable
debit cash and credit purchases

Explanation:

When merchandise is bought on account, Purchases (an expense account which increases with a debit) is debited as the company has acquired goods. Accounts Payable (a liability account which increases with a credit) is credited as the company owes money for the merchandise purchased. Cash is not involved in this transaction (so options with Cash are incorrect). Accounts Receivable is related to amounts owed to the company (not for purchases on account).

Answer:

debit Purchases and credit Accounts Payable