Question

1.Started business with cash 400,000 and stock 200,000
2. Machinery purchased for cash 60,000
3. Cash deposits in bank 40,000
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Accounting equation

Answer 1

assets= capital + liabilities
cash+stock+ machinery +cash at bank = capital
300000+200000+60000+ 40000 = 400000+20000
600000=600000

Answer 2

1.Started business with cash 400,000 and stock 200,000
   cash +stock = capital
  400000+200000=600000

2. Machinery purchased for cash 60,000
        cash +stock+machinery = capital
         400000+200000=600000
        (60000)+200000+60000=600000
         360000+200000+60000=600000

3. Cash deposits in bank 40,000
 cash +stock+machinery+bank  = capital
360000+200000+60000=600000
  (40000)+200000+60000+40000=600000
320000+200000+60000+40000 =600000

therefore 600000= 600000

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