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    Smcleish's Avatar
    Smcleish Posts: 1, Reputation: 1
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    #1

    Apr 22, 2008, 02:42 PM
    T accounts -not sure where to credit this
    Hello,
    I am just beginning accounting and it has been going pretty smoothly until now.
    In my problem 4,500 dollars in repair parts has been used in one month. There is an existing T account , Repair Parts Inventory, that I know to debit the 4,500 to. I just do not have any idea where to credit this amount. Can you please help me?
    My existing T accounts are cash, capital, a/r,a/p,prepaid rent,shop equipment and unearned revenue. Do I create another T account to fit the 4,500 into or use one of these existing T accounts? I know that this is not a cash amount, it's inventory, I just don't know where the inventory goes.
    Thank you
    Smcleish
    jan96ken's Avatar
    jan96ken Posts: 2, Reputation: 1
    New Member
    		  
    #2

    Apr 27, 2008, 09:09 PM
    I am just beginning accounting and it has been going pretty smoothly until now.
    In my problem 4,500 dollars in repair parts has been used in one month. There is an existing T account , Repair Parts Inventory, that I know to debit the 4,500 to. I just do not have any idea where to credit this amount. Can you please help me?
    My existing T accounts are cash, capital, a/r,a/p,prepaid rent,shop equipment and unearned revenue. Do I create another T account to fit the 4,500 into or use one of these existing T accounts? I know that this is not a cash amount, it's inventory, I just don't know where the inventory goes.
    Thank you

    On your T Account, did you originally debit Repair Parts inventory when you purchased the items?

    If so,
    I think you would credit Repair Parts Inventory $4,500
    (because you used the parts and are reducing the inventory)

    The debit should be to an expense account(Repair Parts Expense)
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