Question

Harish started business with cash wht is ledger posting in Harish account

Answer 1

Given "Harish started business with cash"

This transaction affects two accounts Harish capital a/c , cash a/c ... Where Harish capital a/c cash a/c are real account(all assets and Liabilities come under Real account)


The Three golden rules of accounting are

Personal account - Debit the receiver, credit the giver

Real account - Debit What comes in, credit what goes out

Nominal account - Debit All expenses and losses, credit all incomes and Gains

So Per the above rules..since cash is incoming so should be debited.. and liability is increasing (capital) so should be credited..


So the Journal Entry will be

cash a/c Dr xxxxx

To Harish capital a/c. xxxxx

(Being business commenced with cash )


Ledger accounts -


Harish capital a/c
–-----–-------------------------------------------------------
To balance c/d xxxxx. | By cash a/c xxxxxx



Cash a/c
-------------------------------------------------------
To Harish | By balance c/D xxxx
capital a/c xxxx. |