Question

At the beginning of accounting year the following particulars are extracted value of Assets Rs. 25,000, Liabilities Rs. 5,000, Debit balance of income and expenditure account Rs. 2,500. Then capital fund will be ____________.

• A. Rs. 32,500
• B. Rs. 22,500
• C. Rs. 27,500
• D. Rs. 20,000

Answer 1

Answer: (B)

Rs. 22,500

Capital Fund = Extracted value of Assets + Debit bal. of Income and expenditure - Liabilities
Capital Fund = Rs. 25,000 + Rs. 2,500 - Rs. 5,000
Capital Fund = Rs. 22,500