Which of the following double-entries is the correct way to record money received from shareholders as new capital into the business’s bank account?
Select ONE answer:
- Account to Debit Capital / Account to Credit Bank
- Account to Debit Cash / Account to Credit Capital
- Account to Debit Bank / Account to Credit Capital
- Account to Debit Capital / Account to Credit Cash
Show your workings to arrive at your answer, and explain and justify your reasons:
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This multiple choice question is suitable for Accounting KS5 classes.
The answer is 3 – This is the correct double entry record when a business receives new capital from shareholders into its bank accounts.
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