Prepare accounting equation from the following:
Rs
(a)
Kunal started business with cash
2,50,000
(b)
He purchased furniture for cash
35,000
(c)
He paid commission
2,000
(d)
He purchases goods on credit
40,000
(e)
He sold goods (costing Rs 20,000) for cash
26,000
Prepare accounting equation from the following:
|
|
|
Rs |
|
(a) |
Kunal started business with cash |
2,50,000 |
|
(b) |
He purchased furniture for cash |
35,000 |
|
(c) |
He paid commission |
2,000 |
|
(d) |
He purchases goods on credit |
40,000 |
|
(e) |
He sold goods (costing Rs 20,000) for cash |
26,000 |
S.No.
Explanation
Assets
Liabilities
+
Capital
Cash
+
Furniture
+
Stock
=
Creditors
(a)
Increase in cash
2,50,000
Increase in capital
2,50,000
2,50,000
=
NIL
+
2,50,000
(b)
Increase in furniture
35,000
Decrease in cash
(35,000)
2,15,000
+
35,000
=
NIL
+
2,50,000
(c)
Decrease in capital (Expense)
(2,000)
Decrease in cash
(2,000)
2,13,000
+
35,000
=
NIL
+
2,48,000
(d)
Increase in stock
40,000
Increase in creditors
40,000
2,13,000
+
35,000
+
40,000
=
40,000
+
2,48,000
(e)
Increase in cash
26,000
Decrease in stock
(20,000)
Increase in capital (Profit)
6,000
2,39,000
+
35,000
+
20,000
=
40,000
+
2,54,000
|
S.No. |
Explanation |
Assets |
|
Liabilities |
+ |
Capital |
||||||
|
Cash |
+ |
Furniture |
+ |
Stock |
|
|
= |
Creditors |
||||
|
(a) |
Increase in cash |
2,50,000 |
|
|||||||||
|
Increase in capital |
|
|
|
|
|
|
|
|
|
|
2,50,000 |
|
|
|
2,50,000 |
= |
NIL |
+ |
2,50,000 |
|||||||
|
(b) |
Increase in furniture |
35,000 |
|
|||||||||
|
Decrease in cash |
(35,000) |
|
|
|
|
|
|
|
|
|
||
|
|
2,15,000 |
+ |
35,000 |
= |
NIL |
+ |
2,50,000 |
|||||
|
(c) |
Decrease in capital (Expense) |
(2,000) |
||||||||||
|
Decrease in cash |
(2,000) |
|
|
|
|
|
|
|
|
|
||
|
|
2,13,000 |
+ |
35,000 |
= |
NIL |
+ |
2,48,000 |
|||||
|
(d) |
Increase in stock |
40,000 |
|
|||||||||
|
Increase in creditors |
|
|
|
|
|
|
|
|
40,000 |
|
|
|
|
2,13,000 |
+ |
35,000 |
+ |
40,000 |
= |
40,000 |
+ |
2,48,000 |
||||
|
(e) |
Increase in cash |
26,000 |
|
|||||||||
|
|
Decrease in stock |
|
(20,000) |
|
||||||||
|
|
Increase in capital (Profit) |
|
|
|
|
|
|
|
|
|
|
6,000 |
|
|
|
2,39,000 |
+ |
35,000 |
+ |
20,000 |
|
|
= |
40,000 |
+ |
2,54,000 |
