Andy, an inexperienced accountant, had to account for his company's purchase of a motorcar on credit. Unsure of the correct accounting entries, Andy debited the supplier's account and credited the motor expenses account. Was Andy correct?

Andy is correct

No he should have credited the motor car as either inventory ( depending on the type of company he worked for) or an asset and the he should have credited the Accounts Payable account because the machine was brought on credit therefore it is a liability to the company and must be repaid at sometime in the future.

es. Andy's recording of the transaction was correct.

Correct

Andy, an inexperienced accountant, had to account for his company's purchase of a motorcar on credit. Unsure of the correct accounting entries, Andy debited the supplier's account and credited the motor expenses account. Was Andy correct?

No, Andy was not correct in his accounting entries. When recording a purchase on credit, the correct accounting entries should be as follows:

1. Debit the Motorcar Asset account: This increases the value of the company's motorcar asset.
2. Credit the Accounts Payable or Supplier's Account: This acknowledges the debt owed to the supplier for the purchase of the motorcar.

The Motor Expenses account is typically used to record expenses related to the ongoing usage and maintenance of the motorcar, such as fuel, repairs, and insurance. It should not be used for recording the initial purchase of the motorcar.

It's important for accountants, especially those who are inexperienced, to consult accounting standards or seek guidance from more experienced colleagues to ensure correct accounting entries are made.