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6. Maurice Norris owner of Rare Bookstore Inc. bought a computer for his own use.He paid for the computer by writing a cheque on the bookstore chequing account and charged the 27 Office Equipment account 28 Principle Qualitative Charactertic

Question

6. Maurice Norris owner of Rare Bookstore Inc. bought a computer for his own use.He paid for the computer by writing a cheque on the bookstore chequing account and charged the 27 Office Equipment account 28 Principle Qualitative Charactertic

6. Maurice Norris owner of Rare Bookstore Inc. bought a
computer for his own use.He paid for the computer by writing a
cheque on the bookstore chequing account and charged the
27 Office Equipment account
28 Principle
Qualitative Charactertic

Solution

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XanderElite · Tutor for 8 years

Answer

The correct answer is 27 Office Equipment.<br /><br />Since the computer was purchased for Maurice Norris' *own use*, and not for Rare Bookstore Inc., the debit should not be to the bookstore's Office Equipment account. Charging the bookstore's account violates the **business entity principle**, which requires that the business's financial records be kept separate from the owner's personal financial records. The bookstore and Maurice Norris are separate entities. He should have used his personal funds to purchase the computer.<br />
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