Raghunath had the following transactions in an accounting year:
(i) Commenced business with cash ₹ 50,000.
(ii) Paid into bank ₹ 10,000.
(iii) Purchased goods for cash ₹ 20,000 and credit ₹ 30,000.
(iv) Sold goods for cash ₹ 40,000 costing ₹ 30,000.
(v) Rent paid ₹ 500.
(vi) Rent outstanding ₹ 100.
(vii) Bought furniture ₹ 5,000 on credit.
(viii) Bought refrigerator for personal use ₹ 5,000.
(ix) Purchased motorcycle for cash ₹ 20,000.
Create an Accounting Equation to show the effect of the above and also show his Balance Sheet.
(i) Commenced business with cash ₹ 50,000.
(ii) Paid into bank ₹ 10,000.
(iii) Purchased goods for cash ₹ 20,000 and credit ₹ 30,000.
(iv) Sold goods for cash ₹ 40,000 costing ₹ 30,000.
(v) Rent paid ₹ 500.
(vi) Rent outstanding ₹ 100.
(vii) Bought furniture ₹ 5,000 on credit.
(viii) Bought refrigerator for personal use ₹ 5,000.
(ix) Purchased motorcycle for cash ₹ 20,000.
Create an Accounting Equation to show the effect of the above and also show his Balance Sheet.
S. No.
Transaction
Assets
=
Liabilities
+
Capital
Cash
(Rs)
+
Bank
(Rs)
+
Stock
(Rs)
+
Furniture
(Rs)
+
Motor Cycle
(Rs)
=
Creditors
(Rs)
+
Outstanding Rent
(Rs)
(Rs)
(i)
Commenced business with cash Rs 50,000
50,000
50,000
50,000
=
50,000
(ii)
Paid in to bank Rs 10,000
– 10,000
+
10,000
40,000
+
10,000
=
50,000
(iii)
Purchased goods for Cash Rs 20,000 and Credit Rs 30,000
–20,000
+
20,000
30,000
30,000
20,000
+
10,000
+
50,000
=
30,000
+
50,000
(iv)
Sold goods for Cash Rs 40,000 Costing Rs 30,000
40,000
– 30,000
=
10,000
(Expense)
60,000
+
10,000
+
20,000
=
30,000
+
60,000
(v)
Rent paid Rs 500
– 500
=
– 500
(Expense)
59,500
+
10,000
+
20,000
=
30,000
+
59,500
(vi)
Rent Outstanding Rs 100
100
+
– 100
(Expense)
59,500
+
10,000
+
20,000
=
30,000
+
100
+
59,400
(vii)
Bought furniture Rs 5,000 on credit
5,000
=
5,000
59,500
+
10,000
+
20,000
+
5,000
=
35,000
+
100
+
59,400
(viii)
Bought refrigerator for personal use Rs 5,000
– 5,000
=
– 5,000
(Drawings)
54,500
+
10,000
+
20,000
+
5,000
=
35,000
+
100
+
54,400
(ix)
Purchased motorcycle for cash
– 20,000
+
20,000
34,500
+
10,000
+
20,000
+
5,000
+
20,000
=
35,000
+
100
+
54,400
Balance Sheet
Liabilities
Amount (Rs)
Assets
Amount (Rs)
Capital
54,400
Cash
34,500
Creditors
35,000
Bank
10,000
Rent Outstanding
100
Stock
20,000
Furniture
5,000
Motor Cycle
20,000
89,500
89,500
|
S. No. |
Transaction |
Assets |
= |
Liabilities |
+ |
Capital |
||||||||||
|
Cash (Rs) |
+ |
Bank (Rs) |
+ |
Stock (Rs) |
+ |
Furniture (Rs) |
+ |
Motor Cycle (Rs) |
= |
Creditors (Rs) |
+ |
Outstanding Rent (Rs) |
|
(Rs) |
||
|
(i) |
Commenced business with cash Rs 50,000 |
50,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000 |
|
|
|
50,000 |
|
|
|
|
|
|
|
|
= |
|
|
|
|
50,000 |
|
(ii) |
Paid in to bank Rs 10,000 |
– 10,000 |
+ |
10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,000 |
+ |
10,000 |
|
|
|
|
|
|
= |
|
|
|
|
50,000 |
|
(iii) |
Purchased goods for Cash Rs 20,000 and Credit Rs 30,000 |
–20,000 |
|
|
+ |
20,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,000 |
|
|
|
|
|
30,000 |
|
|
|
|
|
|
|
20,000 |
+ |
10,000 |
+ |
50,000 |
|
|
|
|
= |
30,000 |
|
|
+ |
50,000 |
|
(iv) |
Sold goods for Cash Rs 40,000 Costing Rs 30,000 |
40,000 |
|
|
|
– 30,000 |
|
|
|
|
= |
|
|
|
|
10,000 (Expense) |
|
|
|
60,000 |
+ |
10,000 |
+ |
20,000 |
|
|
|
|
= |
30,000 |
|
|
+ |
60,000 |
|
(v) |
Rent paid Rs 500 |
– 500 |
|
|
|
|
|
|
|
|
= |
|
|
|
|
– 500 (Expense) |
|
|
|
59,500 |
+ |
10,000 |
+ |
20,000 |
|
|
|
|
= |
30,000 |
|
|
+ |
59,500 |
|
(vi) |
Rent Outstanding Rs 100 |
|
|
|
|
|
|
|
|
|
|
|
|
100 |
+ |
– 100 (Expense) |
|
|
|
59,500 |
+ |
10,000 |
+ |
20,000 |
|
|
|
|
= |
30,000 |
+ |
100 |
+ |
59,400 |
|
(vii) |
Bought furniture Rs 5,000 on credit |
|
|
|
|
|
|
5,000 |
|
|
= |
5,000 |
|
|
|
|
|
|
|
59,500 |
+ |
10,000 |
+ |
20,000 |
+ |
5,000 |
|
|
= |
35,000 |
+ |
100 |
+ |
59,400 |
|
(viii) |
Bought refrigerator for personal use Rs 5,000 |
– 5,000 |
|
|
|
|
|
|
|
|
= |
|
|
|
|
– 5,000 (Drawings) |
|
|
|
54,500 |
+ |
10,000 |
+ |
20,000 |
+ |
5,000 |
|
|
= |
35,000 |
+ |
100 |
+ |
54,400 |
|
(ix) |
Purchased motorcycle for cash |
– 20,000 |
|
|
|
|
|
|
+ |
20,000 |
|
|
|
|
|
|
|
|
|
34,500 |
+ |
10,000 |
+ |
20,000 |
+ |
5,000 |
+ |
20,000 |
= |
35,000 |
+ |
100 |
+ |
54,400 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet |
|||
|
Liabilities |
Amount (Rs) |
Assets |
Amount (Rs) |
|
Capital |
54,400 |
Cash |
34,500 |
|
Creditors |
35,000 |
Bank |
10,000 |
|
Rent Outstanding |
100 |
Stock |
20,000 |
|
|
|
Furniture |
5,000 |
|
|
|
Motor Cycle |
20,000 |
|
|
89,500 |
|
89,500 |
|
|
|
|
|
