Question

Illustration 3. Rakesh started business as on 1st April, 2016 with a capital of
* 1,50,000. During the year, the following transactions took place:
Hv
1. Furniture purchased for cash.
2. Purchased goods from Mahesh on credit.
13. Sold goods (costing * 10,000) to Mohan for cash.
4. Additional capital introduced.
5. Commission received in advance.
76 Paid to creditor (Mahesh) * 22,500 in full settlement.
- Sold goods (costing * 15,000) for 18,000 out of which 5,000
received in cash.
Hu8. Depreciation on furniture provided @ 10%.
20,000
25,000
14,000
20,000
2,000
​

Answer 1

Explanation:

commission recieved in advance will be credited because it's a liability of the firm