SHOW THE EFFECT OF THE FOLLOWING TRANSACTIONS ON THE ACCOUNTING EQUATION:(A) STARTED BUSINESS WITH CASH 1,00,000 AND MACHINERY 50,000 (B) PURCHASED GOODS FOR 50,000 FROM NARESH AND 20,000 FOR CASH (C) SOLD 50% OF THE GOODS AT A PROFIT OF 10%. (D) PAID SALARY 10,000 (E) INTEREST DUE BUT NOT PAID 20,000 (F) DEPRECIATE MACHINERY @10%
Answers
Answer:
A. cash ac dr 100000
machinary ac dr 50000
to capital ac cr 150000
B Good ac dr 70000
to naresh ac cr 50000
to cash ac cr 20000
C Sundry debtor ac dr 38500
to sales ac cr 38500
D salary ac dr 10000
to cash ac cr 10000
E interest ac dr 20000
to interest o/s ac cr 20000
F depreciation ac dr 5000
to machinery ac cr 5000
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Explanation:
A 50% of goods at profit of 10% calculation
- total good in stock = bought from naresh 50000 worth and bought in cash 20000 therefore total 70000
70000x 50% =35000
2. Profit of 10% calculation
35000 x 10% = 3500
therefore profit is 3500
3. hence total value of sale would be
cost + profit = sale
35000 + 3500 = 38500
B calculation of depreciation
cost 50000
less: depreciation@10% 5000
45000