Per company policy, tools with a purchase price greater than $1,000 are capitalized
Discipline: Accounting
Type of Paper: Question-Answer
Academic Level: Undergrad. (yrs 3-4)
Paper Format: APA
Pages: 1
Words: 275
Question
Per company policy, tools with a purchase price greater than $1,000 are capitalized. What's the correct entry to record a tool purchase of $500?
A) Debit fixed assets $1000, Credit cash $1,000
B) Debt fixed asset $500, Credit tools expense $500
C) Debt fixed asset $500, Credit cash $500
D) Debt tools expense $1,000, Credit cash $1,000
E) Debt tools expense $500, Credit cash $500