Question

Identify the credit aspect in the following transaction
Rs
01 Started business
with Machinery
10 000
U4 Cash paid to Fari
07 Sold goods on credit
800
16 Sold Plant for cash
8.000
25 Paid cartage
30 Provide interest on capital
2 000​

Answer 1

Assets

=

Liabilities

+

Capital

Cash

(Rs)

+

Stock

(Rs)

=

Creditors

(Rs)

+

Outstanding Rent

(Rs)

(Rs)

(i)

Harish started business with cash

18,000

=

18,000

18,000

=

18,000

(ii)

Purchased goods for Cash Rs 5,000 and on credit Rs 2,000

– 5,000

+

7,000

=

2,000

13,000

+

7,000

=

2,000

+

18,000

(iii)

Sold goods for cash Rs 4,000 costing Rs 2,400

4,000

– 2,400

=

1,600

(Profit)

17,000

+

4,600

=

2,000

+

19,600

(iv)

Rent paid Rs 1,000 and Rent Outstanding Rs 200

– 1,000

=

200

– 1,200

16,000

+

4,600

=

2,000

+

200

+

18,400