Question

…Prepare Accounting Equation from the following transactions: a) Started business with cash Rs.1,50,000,Goods Rs.1,00,000 b) Bought goods for cash Rs.80,000 and on credit for Rs.40,000 c) Goods costing Rs.50,000 sold at a profit of 40 % . Half of the amount received in cash d) Goods costing Rs.20,000 sold for Rs.18,500 for cash e) Salaries paid Rs.5,000 and Rs.2,000 is still due f) Paid Rs.25,000 to the creditor for his account of Rs.40,000

Answer 1

Answer:

ACCOUNTING EQUATIONS. No.TransactionAssets=Liabilities+CapitalCash+Furniture+Stock=Creditors  (i)Sandeep started business with cash1,00,000      +1,00,000  1,00,000    = +1,00,000(ii)Purchased furniture for cash–5,000 +5,000        95,000+5,000  = +1,00,000(iii)Purchased goods for cash–20,000   +20,000      75,000+5,000+20,000= +1,00,000(iv)Purchased goods on credit    +36,000 +36,000    75,000+5,000+56,000=36,000+1,00,000(v)Rent paid-700       –700  74,300+5,000+56,000=36,000+99,300(vi)Goods costing Rs 40,000 sold at a profit of 20% for cash+48,000   -40,000   +8,000  1,22,300+5,000+16,000=36,000+1,07,300