Correct Option: B. Debit purchases account and credit cash account Explanation of the Correct Answer: When a company like Antics Electronic Company purchases generators, it is acquiring an asset that will be used in its operations. The correct way to record this transaction in the accounting books involves understanding the nature of the accounts involved and the double-entry accounting system.

1. Understanding the Accounts:
2. Purchases Account: This account is used to record the cost of goods that a company buys for resale or for use in its operations. In this case, the generators are likely to be used in the company's operations, so they are treated as purchases.
3. Cash Account: This account reflects the cash available to the company. When cash is spent to buy the generators, the cash account decreases.
4. Double-Entry Accounting:
5. In double-entry accounting, every transaction affects at least two accounts. One account is debited, and another is credited. The total debits must equal the total credits.
6. In this transaction, the company is spending cash (which decreases the cash account) and acquiring generators (which increases the purchases account).
7. Recording the Transaction:
8. Debit Purchases Account: This increases the purchases account, reflecting that the company has acquired new assets (the generators).
9. Credit Cash Account: This decreases the cash account, indicating that cash has been spent to acquire the generators.

The journal entry for this transaction would look like this: - Debit Purchases Account: $X (where $X is the total cost of the six generators) - Credit Cash Account: $X Why the Other Options are Incorrect:

• Option A: Debit generator account and credit cash account:
• This option suggests debiting the generator account directly. However, in many accounting systems, the generator would be recorded under a purchases account first, especially if they are not immediately capitalized as fixed assets. This option is not the standard practice for recording such transactions.
• Option C: Debit cash accounts and credit purchases account:
• This option is incorrect because it suggests that cash is being increased (debited) while the purchases account is being decreased (credited). This is the opposite of what happens in this transaction. Cash is going out, so it should be credited, not debited.
• Option D: Debit cash account and credit generator account:
• This option is also incorrect because it implies that cash is being received (debited) and that the generator account is being credited. This does not reflect the purchase of generators; instead, it suggests a sale or return of generators, which is not the case here.

Summary of Key Points:

• The correct method to record the purchase of generators is to debit the purchases account and credit the cash account.
• This reflects the acquisition of an asset and the reduction of cash.
• Understanding the nature of accounts and the principles of double-entry accounting is crucial for accurate financial reporting.
• Always ensure that total debits equal total credits in every transaction.

By following these principles, you can accurately record transactions and maintain proper financial records.