Question

Business started with capital Rs. 50,000 on 1-8-18

Answer 1

so the business is lower.

Answer 2

3 golden rules

• debit the receiver , credit the giver

• debit what comes in , credit what goes out

• debit all the expenses and losses , credit all the incomes and gains

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Reason for debit and credit

Cash A/c - real A/c , money comes into the business therefore its debited

Capital A/c - personal A/c , where owner whos the giver of cash and goods to the business , therefore its credited

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Journal entry

Cash A/c Dr 50000

To Capital A/c 50000

(being started business with cash )

Hope its useful..!!