Question

On which side the Increase in the following accounts will be recorded ? Also state the nature of account:

Machinery
(ii)Electricity paid
(iii) Wages paid
(iv) Commission received
(o) Cash
(ui) Debtors
(vii) Creditors
(viii) Proprietor's capital account​

Answer 1

Answer:

i) DR,

ii) DR

iii) DR

iv) CR

v) DR

vi) DR

vii) CR

viii) CR

Explanation: Nature of account

i) assets

ii)expenses

iii)expenses

iv) revenue

v) assets

vi) assets

vii) liability

viii) Capital

Answer 2

Answer:

Find out the Total Liability (internal as well as external) at the end of the year if :

(i) Proprietor's equity at the beginning of the year * 80.000

(ii) Creditors' equity at the beginning of the year 40,000

(iii) Proprietor's withdrawal during the year 15,000

(iv) Net profit during the year 25,000

(v) Borrowed from Allahabad Bank during the year 250,000