Question

Prove that the accounting equation is satisfied in all the following transactions

of Sudhir:-

1. Started business with cash Rs 50,000 and goods Rs 20,000.

2. Bought goods for cash Rs 15,000 and on credit for Rs 10,000.

3. Goods costing Rs 24,000 sold at a profit of 33 1/3%. Half the payment

received in cash.

4. Purchased furniture for office use Rs 6000 and for household use of Sudhir

Rs 4,000.

In 4th transaction which side will increase and decrease, pls. explain clearly.

Answer 1

case a/c Dr to capital a/c (2) purchase a/c Dr to cash a/c to credit a/c (4) furniture a/c Dr to office equipment a/c