Question

Prepare Accounting Equation from the following :-
1. Sandeep started business with Cash
2. Purchased furniture for cash
3. Purchased goods for cash
4. Purchased goods on credit
5. Paid for rent
6. Goods Costing 40,000 sold at a profit of 20% for cash
1,00,000
5,000
20,000
36,000
700​

Answer 1

Answer:

1-Cash a/c. Dr

To capital a/c

(being sandeep started business with cash)

2-Furniture. a/c. Dr

To cash a/c

(being purchased furniture for cash)

3- purchases. a/c. Dr

To cash. a/c

(being goods purchased for cash)

4- purchases a/c. Dr

To creditor a/c

(being goods purchased on credit)

5-rent. a/c. Dr

To cash. a/c

(being rent paid)

6-cash. a/c. Dr

To sales a/c

(being goods sold for profit)

Explanation:

1-cash-real a/c-debit-what comes in,

capital- personal a/c -credit-credit the giver

2-furniture-real a/c-debit-what comes in

cash - real a/c - credit - what goes out

3-purchases- real a/c -debit- what comes in

cash -real a/c - credit- what goes out

4-purchases-real a/c-debit-what comes in

creditor- personal a/c - credit - credit the giver

5-rent-nominal a/c- debit- All expenses and losses

cash -real a/c - credit-what goes out

6-cash- real a/c-debit-what comes in

sales- real a/c - credit- what goes out