Question

3.
Mohit has the following transactions, prepare accounting equation:
(a) Business started with cash
* 1,75,000
(b) Purchased goods from Rohit
50,000
(c) Sales goods on credit to Manish (Costing * 17,500)
20,000
!
(d) Purchased furniture for office use
10,000
(e) Cash paid to Rohit in full settlement
48,500
(f) Çash received from Manish
20,000
(g) Rent paid
1,000
(h) Cash withdrew for personal use
73.000
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Answer 1

Answer:

a. Cash Dr 175000

To capital Cr 175000

(Being business started with cash.)

b. Purchase Dr 50000

To Rohit Cr. 50000

(Being Goods bought from Rohit.)

c. Manish. Dr20000

To Sales Cr. 17500

To profit on sale of goods Cr 2500

(Being Goods sold to Manish and Received sales on profit.)

d. Furniture. Dr 10000

To Cash /Bank Cr. 10000

(Being furniture bought for office use.)

e. Rohit. Dr. 50000

To Cash Cr. 48500

To Discount Received Cr 1500

(Being amount paid to Rohit and discount Received.)

f. Cash. Dr 20000

To Manish Cr. 20000

(Being amount received from manish in cash.)

g. Rent. Dr 1000

To cash/ Bank Cr 1000

(Being rent paid in cash/ Bank.)

h. Drawing Dr 73000

To Bank Cr 73000

(Being cash withdrawal for personal use.)