Question

Show an Accounting Equation on the basis of following transaction:
(i) Started business with cash Rs.10,000.
(ii) Paid rent in advance Rs.300.
(iii) Purchased goods for cash Rs.5,000 and credit Rs. 2,000.
(iv) Sold goods for cash Rs.8,000 costing Rs. 4,000.
(v) Paid salary Rs. 450 and salary outstanding Rs. 100.
(vi) Bought motorcycle for personal use Rs.3,000.

Answer 1

(1) capital a/c.....dr. 10000
to cash a/c. 10000

(2) prepaid rent a/c.....dr. 300
to cash a/c. 300

(3) purchase a/c .....dr. 7000
to cash a/c. 5000
to bank a/c. 2000

(5) salary a/c.....dr. 450
to cash a/c. 450
salary a/c.....dr. 100
to salary o/s. a/c. 100

(6). drawings alc....dr 3000
to casha/c. 3000