Question

Prove that the Accounting Equation is satisfied in all the following transactions: (i) Started business with cash Rs.1,00,000 (ii) Purchased goods on credit Rs.4,000 (iii) Purchased goods for cash Rs.1,000 (iv) Withdrew cash for private use Rs.850

Answer 1

(i) Cash a/c
to Capital Introduced

(ii) purchase A/c
to Creditors

(iii) Purchase a/c
to cash

(iv) Capital A/c
to cash