1. Prepare the accounting equation for the following:
i. Mr X started business with cash 1,80,000
ii. Purchased goods for cash 60,000 and in credit 30,000
Sold goods for cash 40,000 costing 24,000
iv. Rent paid 5,000 and rent outstanding 2,400
V. Sold goods on credit 50,000 (costing 38,000)
vi. Salary paid in advance 3,000
vü. Provide interest on capital @10%
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Answer:
Assets
=
Liabilities
+
Capital
Cash
(Rs)
+
Bank
(Rs)
+
Stock
(Rs)
=
Creditors
(Rs)
(Rs)
(i)
Started business with cash
45,000
=
45,000
45,000
=
45,000
(ii)
Opened a Bank Account with a deposit
– 4,500
+
4,500
=
40,500
+
4,500
=
45,000
(iii)
Bought goods from M/s. Sun & Co.
11,200
=
11,200
40,500
+
4,500
+
11,200
=
11,200
+
45,000
Total Assets
=
Cash + Bank + Stock
=
40,500 + 4,500 + 11,200
=
Rs
56,200
Liabilities
=
11,200
Capital
=
45,000
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