Question

sethi commenced bussiness with cash he opned account with bank and deposited

Answer 1

3 golden rules

• debit the receiver , credit the giver

• debit what comes in , credit what goes out

• debit all the expenses and losses , credit all the incomes and gains

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reason for debit and credit

Cash A/c - Real A/c , where money comes into  the business therefore its debited

Capital - Personal A/c ,where sethi gives to business to start business therefore crdited  

Journal entry

Cash A/c   Dr    

         To capital A/c

(being started business with cash)

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reason for debit and credit

Cash A/c - Real A/c , where money goes out of the business therefore its credited

BAnk A/c- personal A/c , where banker is the receiver of money , as we deposited in bank , therefore its debited

Journal entry

Bank  A/c    Dr

        To cash A/c

(being cash deposited in bank)

Answer 2

Cash A/C. Dr. Rs.xxx

To Capital A/C. Rs.xxx

(Being capital brought in the form of cash)

Bank A/C. Dr. Rs.xxx

To Cash A/C. Rs.xxx

(Being cash deposited into the bank)