Q. Journalise the following transactions in the books of Mantri:
2011 June 1 - Commenced business with Cash Rs. 1,20,000. Goods Rs. 60,000 and Furniture Rs. 65,000.
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Cash A/C Dr 120000
Goods A/C Dr 60000
Furniture A/C Dr 65000
To Capital A/C 245000
(Being business commenced with cash, goods and furniture)
Explanation:
Why debited ?
Because as we know, if assets increase we have to debit it since Cash, goods and furniture are increasing we debited it.
Why credited ?
Vice versa, liability increase we have to credit it. Capital has been increased we are crediting it.
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