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Ltd. All rights reserved. (ii) Sold 50% of above goods at a profit of ₹ 2,000 on credit to Ram. Show the accounting equation on the basis of the following transactions and also show the Balance Sheet: Sold goods for cash ₹ 75,000. These solutions for Accounting Equation are extremely popular among Class 11 Commerce students for Accountancy Accounting Equation Solutions come handy for quickly completing your homework and preparing for exams. Join PRO or PRO Plus and Get Lifetime Access to Our Premium Materials Read all … ADVERTISEMENTS: 2. This shows all company assets are acquired by either debt or equity financing. Started business with cash ₹ 75,000 and goods ₹ 25,000. Give one example of each of the following transactions: 2. If the owner is the only one who contributed, then the equation A = … On 31st March, 2012 his assets were worth ₹ 5,00,000 and liabilities ₹ 1,00,000. Purchased goods for Cash ₹ 60,000. Rent Received 3. (iv) Decrease in assets and capital. (i) Started business with Cash ₹ 60,000 and Goods ₹ 30,000. Delete. Opening Capital (Capital as on 1st April, 2013) = Rs 2,00,000. 4. Paid for Rent ₹ 1,500 and for salaries ₹ 2,000. (iv) Goods costing ₹ 20,000 sold at a loss of 5%, out of which ₹ 12,000 received in Cash. Paid for Rent ₹2,000 and for salaries ₹4,000. 4. 6. While journalizing for bad … (d) Purchased goods from Mohan ₹ 80,000. Purchased a typewriter for Cash for ₹ 8,000 for office use. (vii) Paid telephone bill amounting to ₹ 800. From the following transactions, state the nature of accounts and state the accounts which will be debited and credited: Cash, Loan, Creditors c. Creditors, Loan, Bank Overdraft, Bills Payable d. Prepaid Rent, Salary, Outstanding Bills receivables Accounting Equation … 2020 Applect Learning Systems Pvt. 5. Increase in Creditors (being a liability) will be shown on the credit side and decrease in the creditors will be recorded on the debit side of the Creditors Account. (a) Commenced business with cash ₹ 50,000. (c) Bought goods for cash ₹ 30,000 and on credit ₹ 20,000. Ltd. Ans: Ques 27: Show the accounting equation on the basis of following transactions: (i) Commenced business with Cash ₹ 20,000; Goods ₹ 50,000 and Furniture ₹ 30,000. Prepaid expenses . Paid for Rent ₹ 2,000. (I) Increase in Cash (being an asset) will be shown on the debit side and decrease in cash will be recorded on the credit side of the Cash Account. (adsbygoogle = window.adsbygoogle || []).push({}); The amount is credited to the accounts receivable account of the customer to record the fact that the cash has been received from them. Received Cash from Bhushan ₹ 10,000. 6. Cash (Rs) + Prepaid Rent (Rs) + Stock (Rs) Creditors (Rs) + Salary outstanding (Rs) (Rs) (i) Commenced business with cash Rs 60,000. So the equation known as the basic accounting equation is written as: Assets = Owner’s equity + Liabilities. (vi) Purchased typewriter for personal use of the proprietor ₹ 20,000. Hence the amount of asset (cash) is 6,00,000. Put the following on the proper side of Cash account, Debtor's account and Creditor's account: Paid to Raghubir ₹ 30,000. 2. What is Accounting Equation An Accounting Equation is a mathematical expression which shows that the assets and liabilities of a firm are equal. Paid to Raghubir ₹ 20,000. (vi) Received Cash from Debtors ₹ 15,000. Name: Muhammad Fahad Moaiz 3. Accounting Equation for Received Cash on Account Journal Entry The Accounting Equation, Assets = Liabilities + Owners Equity means that the total assets of the business are always equal to the total liabilities plus the equity of the business. ii. Find out his Capital as on 31st March, 2014 and profit earned during the year 2013-14. 40,000.. 4 Cash sales Rs. 5. It requests you to calculate cash received from customers during the year 2016. Received ₹ 800 for Commission. The only other basis on which income and expenses could ever possibly be recorded is the cash basis. ... Q1 Asset cash furniture goods debtor bank machinery Liability creditor bank loan Capital capital Asset cash furniture motor ... Sold goods for cash 20000 0 New equation Sold goods on credit to Mr. Jay 20000 0 New equation Paid cash to Mr. Mayank 20000 0 New equation Cash received from Mr. Jay 20000 0 … (c) Sold goods for Cash costing ₹ 40,000 at a profit of 20% and on Credit costing ₹ 72,000 at a profit of 25%. The accounting equation of these two transactions will be : Accounting Equation MODULE - II Journal and Other Subsidiary Books. | EduRev Commerce Question is disucussed on EduRev Study Group by 142 Commerce Students. Prepare Accounting Equation from the following :− Opening Capital (Capital as on 1st April, 2011) = Rs 5,00,000. Debtors in accounting are amounts which are owed to a business by customers, they are sometimes referred to as accounts receivable. 1. This simple equation illustrates two facts about a company: what it owns and what it owes. 2. ... 1/3 rd of above goods sold at a profit of 10% on cost, and half of the payment is received in cash. 1. Liabilities Accounts: Liabilities are the amounts that an entity owes to the … (II) Increase in Debtors (being an asset) will be shown on the debit side and decrease in them will be recorded on the credit side of the Debtors Account. As we know, increase in liability is recorded on the credit side while decrease in liability will be shown on the debit side of the concerned liability account. If in the above case, the proprietor had introduced fresh capital of ₹ 40,000 and had withdrawn ₹ 10,000 for personal purposes, calculate his profits. 3.Sold goods on Credit to J.Mali for R5880 ( cost price R3920)? 5,000, Debtor Rs. 40 ACCOUNTANCY Notes ... Cash, Stock, Debtors b. Also mention the nature of account:−. 2. Replies. (vi) Received Cash from Debtors ₹ 15,000. If the Capital of a business is ₹ 1,20,000 and Outside liabilities are ₹ 20,000, calculate total assets of the business. Total Cost of Goods Sold = 40,000 + 72,000 = Rs 1,12,000. 2. 6. The equation is satisfied. WN1 Calculation of Selling Price. In order to carry out business activities, the company needs funds; these funds must be given to the company by someone. (There are no revenues on this date. X started a business on 1st April, 2013 with a Capital of ₹ 1,00,000 and a loan of ₹ 50,000 from the bank. Hence, this forms the basis of a lot of analysis to market investors, financial analysts, research analysts, and other financial institutions. (c) Deposited into bank account ₹ 1,80,000. 4. We all know that we record all the business transactions using the Dual Aspect concept. When a business allows a customer credit terms and invoices them for a product or service and receives payment at a later date 30 days 60 days etc, then while the customer owes the business the amount outstanding they are classified as a debtor in the … Bought goods for cash ₹ 30,000 and on credit for ₹ 44,000. 6 Paid Ahmed & Bros. by cash Rs. Purchased goods from Nakul on Credit for ₹ 80,000. 1.A credit note for R35700 issued to a debtor. b. (d) Sold the goods bought on credit for ₹ 25,000. If total assets of a business are ₹ 1,30,000 and capital is ₹ 80,000, calculate creditors. Accounting equation can be simply defined as a relationship between assets, liabilities and owner’s equity in the business. Double Entry Bookkeeping is here to provide you with free online information to help you learn and understand bookkeeping and introductory accounting. This basic accounting equation is the TRUE basics of accounting. (a) Started business with cash ₹ 1,40,000 and Stock ₹ 2,50,000. (vi) Salary paid in advance ₹ 3,000. (f) Cash paid to Krishan ₹ 28,000. View NCERT Solutions for all chapters of Class 13. Email: admin@double-entry-bookkeeping.com. + Assets =- ... Returns to creditors (suppliers), which has the opposite affect on the accounting equation as purchases. Open 'T' shape account of our Creditor 'X' and write the following transactions on the proper side: Open 'T' shape account of our Debtor 'Ram' and write the following transactions on proper side:−, Put the following on the proper side of Cash Account, Debtors's Account and Creditor's Account:-. (c) Purchased goods from Krishan on credit ₹ 36,000. (iii) Sold goods for Cash ₹ 40,000 (costing ₹ 30,000). On 31st March, 2014 his assets were ₹ 3,80,000. Open 'T' shape account of our creditor 'Raghubir' and write the following transactions on the proper side:− 5. Liabilities and owner's equity are unaffected. From the following list, show which are assets and which are liabilities. Withdrew for private use ₹5,000 in cash Solution: Accounting Equation S.NoTransaction Assets = Liabilities + Capital Cash + … Open 'T' shape account for Machinery and write the following on the proper side: As we know, Machinery Account is an asset, so, increase in machinery will be recorded on the debit side while decrease in machinery will be recorded on the credit side of the Machinery Account. On the other hand it also decreases the business assets (debtors). Opening Capital (Capital as on 1st April, 2013) = Rs 1,00,000. (III) Increase in Creditors (being a liability) will be shown on the credit side and decrease in the creditors will be recorded on the debit side of the Creditors Account. (i) Harish started business with cash ₹ 1,80,000. However, we usually work with positive amounts in accounting. Started business with Cash ₹ 1,20,000. Raghu started business with Cash ₹1,50,000. Reply. Journal Entry for Recovery of Bad Debts. Received cash from M/s Bharat & Co., on account, 8,000. (iv) Rent paid ₹ 5,000; and rent outstanding ₹ 2,000. (a) Started business with cash ₹ 50,000 and goods ₹ 30,000. The equation is: Salary Paid 4. No debtor (a credit item) would ever be recorded anywhere. Purchased machinery and equipment for cash. 1,800 would be received at near future. The 'basic accounting equation' is the foundation for the double-entry bookkeeping system. The cash receipt needs to be credited to the customers accounts receivable account. In this case one asset cash increases as the cash is received by the business and another asset (accounts receivable) decreases representing money received from the customer to be allocated against customer invoices at a later date. (i) Commenced business with Cash ₹ 20,000; Goods ₹ 50,000 and Furniture ₹ 30,000. Find out his closing capital and profits earned during the year. 29,500 + 500 + 50,000 = 20,000 + 60, 000 (iv) (iii) Sold goods for cash ₹ 40,000; costing ₹ 24,000. Working Note: Purchased goods on credit from Raghubir, Goods (costing Rs 50,000) sold at a profit of 25% on cost, Purchased goods for cash and on credit from Karan, Goods costing Rs 40,000 sold for Rs 55,000, Sold goods for Cash (cost price was ₹ 3,000), Sold goods (costing Rs 3,000) for Rs 4,000, Goods costing Rs 48,000 sold at a profit of, Goods costing Rs 20,000 sold at a loss of 5% out of which Rs 12,000  were received in cash, Started business with cash, goods and furniture, Sold goods (costing Rs 30,000) for cash Rs 40,000, Sold goods (costing Rs 50,000) to Ram for Rs 65,000, Paid for printing Rs 500 and received commission Rs 1,200, Value of furniture was reduced by ₹ 5,000, Paid rent Rs 4,000 including Rs 1,000 as advance, Purchased goods for cash Rs 30,000 and on credit Rs 20,000, Sold goods (costing Rs 20,000) for Rs 25,000, Purchased furniture Rs 10,000 for office use and Rs 5,000 for domestic use. View Accounting Equation.xlsx from MBA 102 at Indira School Of Business Studies. Debtors or accounts receivable . Withdrew for private use ₹ 5,000 in cash. All questions and answers from the Accountancy Dk Goel 2018 Book of Class 11 Commerce Accountancy Chapter 1 are provided here for you for free. 5. Explanation: The effect of the transaction on the accounting equation is as follows: Assets + (Cash in bank increases) Assets – (Debtors' debt decreases) hopehelpfulforyou. The accounting equation summarizes the essential nature of double-entry system of accounting. ... furniture and fixtures, plant and machinery, vehicles, debtors, bills receivable, bank balance, cash, stock, etc. Since cash is received, The available cash increases from 5,000 to 13,000. On 31st March, 2012, his assets were ₹ 8,00,000. (vii) Paid telephone bill amounting to ₹ 800. Course ... Balance Sheet Financial Ratios Accounting Basics Bookkeeping Accounting Equation Financial Accounting . WN1 Calculation of Selling Price of Goods Sold 3. (i) Started business with cash Rs.18, 000 (ii) Paid rent in advance Rs.400 Cash . 20,000, Machinery Rs. Mohit has the following transactions, prepare Accounting Equation: What will be the effect of the following on the Accounting Equation? *It is assumed that loan borrowed from Citi Bank has not been paid till the end of the accounting year. Sold goods to Bhushan on Credit for ₹ 50,000. (c) Goods costing ₹ 40,000 were sold for ₹ 55,000 for cash. 75,000 Liabilities = Assets - Capital (iii) Depreciation on machinery provided @ 10%. Paid research and development expenses for the current year. (v) Paid Rent ₹ 4,000 and Salary ₹ 6,000. Prepare Accounting Equation from the following: He sold goods (Costing ₹ 20,000) for cash. Opening Capital (Capital as on 1st April, 2011) = Rs 5,00,000 Half the payment received in cash. Capital = Rs. (iv) Ram paid 50% of his balance in cash. Received cash from rajesh this entry amount is 500 ..so where I should enter the amount . A received cash on account journal entry is needed when a business has received cash from a customer and the amount is not allocated to a particular customer invoice or the customer has not yet been invoiced. Prepare Accounting Equation from the following and also prepare a Balance Sheet:- 60,000 + Rs. Calculate his closing capital and profits earned during the year. Goods costing ₹ 50,000 sold at a profit of 25%, out of which ₹ 27,500 received in Cash. Welcome, dear students ! Example of Debtor If a company borrows $10,000 from a bank, the company is the debtor and the bank is the creditor. (e) Purchased furniture worth ₹ 10,000 for office use and for ₹ 5,000 for domestic use. 20,000 . Show the accounting equation on the basis of following transactions: The cost price of these goods was R21000 2.Cash received for service rendered according to cash register roll, R8250. Creditor 8. (a) Started business with cash ₹ 70,000. (b) Purchased goods for Cash ₹ 60,000 and  on Credit ₹ 1,50,000. Working Note: This is an example of collection from … 3. Solution 3: Total Assets = Cash + Debtors + Machinery + Stock = Rs. (ii) Purchased goods from Gopal on Credit ₹ 40,000. Increase in Cash (being an asset) will be shown on the debit side and decrease in cash will be recorded on the credit side of the Cash Account. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. Show the Accounting Equation on the basis of the following and present a balance sheet on the last new equation balances: Prove that the Accounting Equation is satisfied in all the following transactions of Rajaram. Accounting equation in an Income Statement. 3. 1. (d) Purchased goods from Krishan for cash ₹ 10,000. The accounting equation also indicates that the company's creditors have a claim of $7,120 and the owner has a residual claim of $10,080. The accounting records will show the following bookkeeping entries for the cash received on account from the customer: Download the latest available release of our FREE Simple Bookkeeping Spreadsheet by subscribing to our mailing list. On which side the increase in the following accounts will be recorded? (b) Sold goods (costing ₹ 50,000) at a profit of 25% on the cost. Use Accounting Equation to show the effect of the following transactions of M/s Royal Traders :Prepare. According to the cash basis, the income would have been recorded when the cash was finally received in January (the following year). 3. c. Received cash from issuing stock. Accounting is based on the principle of two-sided. 1. Purchased goods for ₹ 50,000 for cash. 500; Received cash by debtors Rs. 3,700; Credit sales Rs. (iv) Cash withdrawn for personal use ₹ 10,000. 1. Purchased goods from Raghubir on credit for ₹ 50,000. Problem 2: From the following particulars make cash book of Ghulam Fatima Trading Co. for the month of November, 2016: 1 Cash balance (Cr) Rs. (vii) Received cash from Rajesh Rs.500 (viii)Withdrew cash for private use Rs.2, 200 (ix) Received rent from tenants Rs.2,500 (x) Purchased goods from Murali for cash Rs.1, 500. At times a debtor whose account had earlier been written off by a creditor as a bad debt may decide to make a payment, this is called the recovery of bad debts. For example, when a company is started, its ass… Purchased a Motor-cycle for personal use ₹ 20,000. Cash received from the debtor $40,000. Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. (a) Motor vehicles (b) Premises (c) Creditors (d) Debtors (e) Money owed to a bank (f) Cash in hand (g) Loan from L Chan (h) Machinery Assets: (a), (b), (d), (f) and (h) Liabilities: (c), (e) and (g) 2.3 The accounting equation (會計等式) … 7. Bills Receivable . Ganesh started business with Cash ₹ 2,00,000. 4. Transaction: Assets = Liabilities + Capital: Cash + Typewriter + Stock + Debtors = Creditors (i) Started business with cash +1,20,000 + 1,20,000 : 1,20,000 = 1,20,000 (ii) Purchased typewriter for office use –8,000 + 8,000 : 1,12,000 + 8,000 = 1,20,000 (iii) Purchased goods for cash –50,000 +50,000 : 62,000 + 8,000 + (iv) Sold goods to Ram on Credit ₹ 65,000 (costing ₹ 50,000). Prepare Accounting Equation on the basis of the following transactions: For example, suppose a business provides design services and has received cash of 4,000 from a customer. (b) Credit purchase of goods ₹ 18,000. Not only does the balance sheet reflect the basic accounting equation as implemented, but also the income statement.. An income statement is prepared to reflect the company’s total expenses and total income to calculate the net … Exercise-6(a): The Alpha company prepares its statement of cash flows using direct method. Find out his Capital as on 31st March, 2014 and profit earned during the year 2013-14. Solution: Question 18. This is true at any time and applies to each transaction. (iii) Increase in assets and capital. Show the accounting equation on the basis of the following transactions and present a Balance Sheet of the last new equation balance: Prove that the accounting equation is satisfied in the following transactions:−. (d) Withdrew cash for personal use ₹ 10,000. 4. (adsbygoogle = window.adsbygoogle || []).push({}); Another double entry bookkeeping example for you to discover. On which side will the increase in the following accounts be recorded? Goods costing ₹75,000 sold at a profit of 3313%. Purchased goods from Raghubir on credit for ₹ 16,000. (i) Started a business with cash ₹ 1,00,000 and goods worth ₹ 20,000. Answer: hi buddy. 10000 ? 25,000 = Rs. (d) Purchase of machinery for cash ₹ 20,000. Goods costing ₹20,000 sold for ₹18,500 for Cash. Further, Commission Received in Advance in Cash, for work which is required to be done in … a. Returned goods to Raghubir for ₹ 5,000. Explanation: Since, Commission Received in Advance in Cash results in Increase in Cash , and Cash is an Asset, receipt of Commission results in an Increase in Asset by Rs. WN1 Calculation of Sale Price. Q.13 Show the Accounting Equation on the basis of the following transactions and present a Balance Sheet on the last new equation balance: ... (ii) 1/3rd of above goods sold at a profit of 10% on cost and half of the payment is received in cash. Debtor 7. (ii) Purchased goods from Gopal on Credit ₹ 40,000. Yogesh commenced business on 1st April, 2011 with a Capital of ₹ 5,00,000 and a loan of ₹ 1,00,000 borrowed from Citi Bank. (iii) Rent paid ₹ 5,000. 4. Prepare Accounting Equation from the following:-, Goods costing ₹ 40,000 sold at a profit of 20% for cash, Working Note: (ix) Introduced fresh Capital ₹ 40,000. Prove that accounting equation is satisfied in all the following cases: 1 Chapter 2 The accounting equation (會計等式) 2.1 Accounting Terms (會計術語) Class work 1 1. (i) Increase in an asset and a liability. While posting the journal entry for recovery of bad debts it is important to note that it is treated as a gain to the business & that the debtor should not be credited as in case of sales.. (v) Withdrew for personal use goods costing ₹ 5,000. 60,000 . (ii) Purchased goods for Cash ₹ 40,000 and on Credit ₹ 25,000. Opening Capital Rs.3,60,000 = Cash Rs.1,50,000 + Stock Rs.60,000 + Machinery Rs.1,00,000 + Furniture Rs.50,000 2. Prepare accounting equation from the following: Accounting Survey of Accounting (Accounting I) Effects of transactions on Accounting equation Describe how the following transactions of McDonald’s Corp. (MCD), would affect the three elements of (he accounting equation. 5,000 + Rs. Prepare Accounting Equation from the following: 7. Purchased goods for ₹ 40,000 on credit. Y started a business on 1st April, 2013 with a Capital of ₹ 2,00,000 and a loan of ₹ 75,000 from the bank. 5. Also mention the nature of account: Open 'T' shape account for Furniture and write the following on the proper side∶−. Receive cash from debtors: The business gains an asset (cash) from another party (the customer) and it increases the business assets. You will also love the ad-free experience on Meritnation’s Accountancy Dk Goel 2018 Solutions. Show the Accounting Equation on the basis of the following transactions and present a Balance Sheet on the last new equation balance: Solution: Question 14. During the year, he had introduced additional capital of ₹ 60,000 and had withdrawn ₹ 36,000 for personal purposes. 60,000 = 60,000 (ii) Paid Rent in Advance Rs 500 – 500 + 500 . 'A' commenced his cloth business on 1st April, 2011 with a capital of ₹ 3,00,000. (b) Paid rent ₹ 4,000 including ₹ 1,000 as advance. In essence, the accounting equation is: Assets = Liabilities + Shareholders' Equity The assets in the accounting equation are the resources that a company has available for its use, such as cash, accounts receivable, fixed assets, and inventory. Purchased goods on credit from Raghubir, 4. ACCOUNTING EQUATION: S. No. Accountancy Dk Goel 2018 Solutions for Class 11 Commerce Accountancy Chapter 1 Accounting Equation are provided here with simple step-by-step explanations. 4. On 31st March, 2014, his assets were ₹ 1,75,000. Goods costing ₹ 60,000 sold for ₹ 80,000 on credit. The accounting equation is, Assets = Equity + Liabilities * The value of assets, liabilities and equity are changed due to business transactions. Therefore, business transactions affect the accounting equation. Show the Accounting Equation for the following transactions of Ritesh for the year 2012. The Accounting Equation, Assets = Liabilities + Owners Equity means that the total assets of the business are always equal to the total liabilities plus the equity of the business. Calculate his liabilities. (vii) Purchased chairs for office use for Cash ₹ 10,000. (b) Purchased goods for cash ₹ 30,000 and on credit from Karan ₹ 20,000. The Cash Basis of Accounting. 20,000 + Rs. Cash Rs. This is true at any time and applies to each transaction. 1,10,000. An Accounting Equation is also called the Balance Sheet Equation. (e) Cash received from Hari ₹ 15,000. It will later be allocated to an invoice posted on the account of the customer. (a) Started business with Cash ₹ 2,00,000. 3. Ajay 1,00,000. (iii) Depreciation on machinery provided @ 10%. 8. For this purpose, the following information has been extracted from the trial balance of the company. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. The accounting equation equates a company’s assets to its liabilities and equity. Brainly UserBrainly User. In fact, the entire double entry accounting concept is based on the basic accounting equation. Increase in Debtors (being an asset) will be shown on the debit side and decrease in them will be recorded on the credit side of the Debtors Account. Paid Cash to Nakul ₹ 20,000. This means that each debit has an equal credit and vice-versa. Goods costing ₹10,000 sold for ₹12,000 on credit. Create an Accounting Equation on the basis of the following transactions: i. Commenced business with cash Rs.50,000, goods Rs.30,000 and furniture Rs.20,000. Copyright © 59,500 + 500 = 60,000 (iii) Purchased goods for Cash Rs 30,000 and Credit Rs 20,000 – 30,000 + 50,000 . Dec 22,2020 - Prepare Accounting Equation. these three items in equation form, we get: Assets – Liabilities = Owner’s equity. Bought goods for cash ₹80,000 and on credit for ₹40,000. Cash has been received by the business and needs to be debited to the asset account of cash. 1. 60,000, Stock Rs. 25,000, Capital Rs. What would be the impact on Accounting Equation of Commission Received in Advance in Cash amounting to Rs. For each transaction, the total debits equal the total credits. Accounts receivable on December 31, 2015: $62,000 Accounts receivable on December 31, 2016: $70,000 … Received from … 10000 . 2,000; Bank balance Rs. In other words, the debtor has a debt or legal obligation to pay the amount owed. (e) Rent outstanding ₹ 2,000. He then received 8,000 payment from M/s Bharat & Co. Accounting interpretation of the transaction . The accounting equation, also called the basic accounting equation, forms the foundation for all accounting systems. Opening Capital (Capital as on March 31, 2011) = Rs 3,00,000. (ii) Purchased goods for cash ₹ 60,000 and on credit ₹ 30,000. For this transaction the Accounting equation is shown in the following table. 75,000. (c) Payment made to creditors in full settlement ₹ 17,500. 2. (iii) Goods costing ₹ 48,000 sold at a profit of 3313%. The result of this transaction is - cash (asset) increased by $40,000 and debtor (asset) decreased by $40,000. Paid salary ₹ 20,000. All Accountancy Dk Goel 2018 Solutions for class Class 11 Commerce Accountancy are prepared by experts and are 100% accurate. (adsbygoogle = window.adsbygoogle || []).push({}); The received cash on account journal entry will be as follows. Prepare accounting equation from the following: (a) Sold goods for cash ₹ 60,000. (viii) Paid for printing ₹ 500 and received Commission ₹ 1,200. Credit notes or goods returned, received from debtors (customers) has exactly the … 6. 8. Under which, the debit always equal to credit, and assets always equal to the sum of equities and liabilities. Part of these assets is provided by the owner, total amount of funds contributed by him is called owner’s equity or capital. Applect Learning Systems Pvt. 3. (v) Sold goods on credit ₹ 50,000 (costing ₹ 38,000). (d) Paid for Rent ₹ 5,000. Also prepare a Balance Sheet:− FREE Downloadable NCERT Solutions.Works without internet, TS Grewal Solutions for Class 12 Commerce, TS Grewal Solutions for Class 11 Commerce, Homework Questions for Class 11 Humanities, Homework Questions for Class 12 Humanities, CBSE Class 10 Board Paper Solutions for Math, CBSE Class 10 Board Paper Solutions for Science, CBSE Class 10 Board Paper Solutions for Social Science, CBSE Class 10 Board Paper Solutions for English, CBSE Class 10 Board Paper Solutions for Hindi, CBSE Class 12 Science Board Paper Solutions for Math, CBSE Class 12 Science Board Paper Solutions for Physics, CBSE Class 12 Science Board Paper Solutions for Chemistry, CBSE Class 12 Science Board Paper Solutions for Biology, CBSE Class 12 Commerce Board Paper Solutions for Economics, CBSE Class 12 Commerce Board Paper Solutions for Accountancy, CBSE Class 12 Commerce Board Paper Solutions for Business Studies, CBSE Class 12 Commerce Board Paper Solutions for Math, CBSE Class 12 Humanities Board Paper Solutions for English, Goods costing Rs 40,000 sold at a profit of 20% for cash, Goods costing Rs 60,000 sold for Rs 80,000 on credit, Purchased Goods for Cash Rs 60,000 and on credit Rs 1,50,000, Sold goods for cash costing Rs 40,000 at a profit of 20% and on credit Rs 72,000 at a profit of 25%, Sold goods costing Rs 20,000 for Rs 26,000, Sold goods on credit to Manish (costing ₹ 17,500), Sold goods costing Rs 17,500 for Rs 20,000 to Manish, Purchased goods for cash Rs 60,000 and on credit Rs 30,000, Sold goods costing Rs 24,000 for Rs 40,000, Rent paid Rs 5,000 and outstanding Rs 2,000, Goods costing Rs 38,000 sold on credit for Rs 50,000, Goods costing Rs 50,000 sold at a profit of 25% out of which Rs 27,500 received in cash, Goods costing Rs 75,000 sold at a profit of, Goods costing Rs 10,000 sold for Rs 12,000 on credit, Goods costing Rs 20,000 sold for Rs 18,500 cash, (ii) Decrease in an asset and a liability, Additional capital brought in by the proprietor, 1. – 30,000 + 50,000 = 20,000 + 60, 000 ( iv ) withdrawn! Later be allocated to an invoice posted on the proper side: − 1 of debtor if a ’. From Mohan ₹ 80,000, calculate creditors so where i should enter amount. ; and Rent outstanding ₹ 2,000 Bookkeeping is here to provide you with free online information to help learn. ‚¹ 8,00,000 Harish Started business with cash ₹ 30,000 ) Ritesh for current. With Deloitte, a big 4 Accountancy firm, and holds a degree from Loughborough University the! Furniture Rs.20,000 the trial Balance of the company needs funds ; these funds be! Ii ) Paid Rent ₹ 4,000 including ₹ 1,000 as Advance cash received from debtors accounting equation of the customer Gopal on credit for.! Bad … what would be the effect of the transaction ₹ 1,50,000 what will be the impact on Equation! Cash has been received by the company are called assets proper side: 1! + Debtors + machinery + stock Rs.60,000 + machinery + stock Rs.60,000 + machinery cash received from debtors accounting equation Rs.60,000... Means that each debit has an equal credit and vice-versa 8: received cash rajesh. And Salary ₹ 6,000 other hand it also decreases the business transactions using the Dual concept! Has worked as an accountant and consultant for more than 25 years and has run small of! Are ₹ 1,30,000 and Capital is ₹ 80,000 goods on credit for ₹ 16,000 by 142 Commerce Students b... This simple Equation illustrates two facts about a company: what will be debited to the asset account the... Receivable > received cash from Debtors ₹ 15,000 were worth ₹ 20,000 equal credit and vice-versa 2,00,000 and loan... Also called the basic Accounting Equation is also called the basic Accounting Equation the. Are called assets the basic Accounting Equation from the following on the basis the... It owns and what it owes Accounting interpretation of the following accounts recorded... Provide you with free online information to help you learn and understand Bookkeeping introductory! Rs 30,000 and on credit ₹ 50,000 ) an Accounting Equation equates a:..., suppose a business is ₹ 1,20,000 and Outside liabilities are ₹ 1,30,000 and Capital is ₹ 80,000 has equal. Debtor ( asset ) increased by $ 40,000 75,000 and goods worth ₹ 20,000 with,. All know that we record all the following transactions of M/s Royal Traders: prepare ₹ 1,20,000 Outside. Expression which shows that the assets and which are assets and which are liabilities = 20,000 + 60, (... ( stock of raw materials, work-in-progress, finished goods etc. which ₹ 27,500 received in Rs. His own free online information to help you learn and understand Bookkeeping and introductory Accounting and vice-versa closing and! Made earlier cash received from debtors accounting equation in full settlement ₹ 17,500 transactions of M/s Royal Traders: prepare from. Of these two transactions will be: Accounting Equation is: Dec 22,2020 - prepare Accounting Equation 會計等式... Equation from the bank MBA 102 at Indira School of business Studies the only other basis on which and. On credit ₹ 36,000 ( vii ) Paid telephone bill amounting to ₹ 800 owned by the business (. ‚¹ 5,00,000 and liabilities of a firm are equal the trial Balance of the business transactions using the Dual concept! From the following accounts be recorded 40,000 ( costing ₹ 40,000 50,000 at! Journal and other Subsidiary Books 55,000 for cash ₹ 10,000 for office use for ₹80,000... ; costing ₹ 50,000 Sold at a profit of 25 % on the proper:! Our creditor 'Raghubir ' and write the following transactions on the basis of following. All the business, he had introduced additional Capital of ₹ 2,000 out business,.... furniture and fixtures, plant and cash received from debtors accounting equation, vehicles, Debtors b Entry Bookkeeping example for you to cash., cash, stock, Debtors b liability for the year 2013-14 working note WN1... ( a ) Commenced business on 1st April, 2011 ) = Rs 2,00,000 & Co. Accounting interpretation of following! % of above goods at a profit of 3313 % of industries received 3 Balance of the.. 10,000 for office use and for salaries ₹ 2,000 ₹ 10,000, show which assets. Bharat & Co., on account Journal Entry in fact, cash received from debtors accounting equation company ₹.! > received cash of 4,000 from a debtor Rs 1,000 whom a on! Sum of equities and liabilities to creditors ( suppliers ), which has opposite! 4,000 and Salary ₹ 6,000 4,000 and Salary ₹ 6,000 ₹ 70,000 the credits!

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