Question

Show the effect of following transaction on the Accounting Equation:

Started business Rs. 2000
Wages Outstanding Rs. 200
Interest due but not paid Rs. 100
Rent paid in advance Rs. 150​

Answer 1

Answer:

(i) Started business with cash Rs. 50,000.

(ii) Salaries paid Rs. 2,000.

(iii) Wages Outstanding Rs. 200.

(iv) Interest due but not paid Rs. 100.

(v) Rent paid in advance Rs. 150.