Question

On July 29, 2016, Wagner Trucking recorded $24,000 in services that they had performed but had not yet been paid by the customer. On the same day, Dixon Trucking recorded $24,000 that they need to pay to their suppliers for gas and oil. What is the difference between how these two transactions will be recorded?

Answer 1

Answer:

$24,000 = Account receivable

$24,000 = Account payable

Explanation:

Since it is given that

The service is performed of $24,000 but not paid by the customer so the same is to be recorded in the account receivable of the asset account

And, the Dixon trucking had the need to pay to their suppliers for $24,000 that is to be recorded in the account payable of the liabilities account

Both the amount is recorded as an account receivable and the account payable respectively