(4) … (ii) Purchased goods for Cash ₹ 40,000 and on Credit ₹ 25,000. (vii) Received ₹ 10,000 from Gupta against the Bills Receivable on its maturity. 2. ... Making a payment to creditor.-300-300: Balance: 15,700: 500: 5,500: 8,500 : 200: 30,000: Let’s check the accounting equation: Assets $30,200 (Cash $15,700 + Supplies $500 + Equipment $5,500 + Truck $8,500) = Liabilities $200 + Equity $30,000. The solution for this question is as follows: Q.10 Prove that the Accounting Equation is satisfied in all the following transactions of Suresh. (iv) He purchases goods on credit ₹ 3,000. Prepare accounting equation from the following: Here, we have provided in a simplistic and a step by step method, which is useful for the students to score well in the board exams. full payment is made to all outside creditors before remaining cash is distributed to partners in a final lump sum payment. Opening Capital (Capital as on 1st April, 2011) = Rs 5,00,000 (i) Commenced … 3. Working Note: f) Goods purchased from Vaibhav for Rs.8,000 and made the payment by cheque. 18,000. Accountancy Dk Goel 2019 Solutions for Class 11 Commerce Accountancy Chapter 1 Accounting Equation are provided here with simple step-by-step explanations. In fact, the entire double entry accounting concept is based on the basic accounting equation. (v) Rent paid in advance ₹ 150. You can interpret the amounts in the accounting equation to mean that ASC has assets of $10,000 and the source of those assets was the owner, J. Ott. Pass Journal entries. (iv) Purchase of machinery for cash ₹ 20,000. Use accounting equation to show the effect of following transactions on assets, liabilities and capital: a)Started business with cash Rs 70,000 b)Purchased goods on credit Rs 18,000 c)Purchased machinery Rs 20,000 d)Payment (a) Started business with cash ₹ 50,000 and goods ₹ 30,000. (ii) Purchased goods for cash 30,000 and on credit from Karan 20,000. Prepare Accounting Equation on the basis of the following transactions: 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. (Delhi 2010) A nswer 7: The following table is showing the accounting equation. T. S. Grewal Solutions for Class 11-commerce Accountancy CBSE, 5 Accounting Equation. (iii) Goods costing ₹ 40,000 were sold for ₹ 55,000. Q.19 If the capital of a business is ₹ 3,00,000 and liabilities are ₹ 50,000, loss ₹ 70,000, calculate the total assets of the business. 17,500 in full settlement … For example, payment to the creditors results in a decrease in the creditors (liability); so, the creditors account will be debited. (a) Started business with Cash ₹ 2,00,000. Prepare Accounting Equation from the following: A. both sides increase B. both sides decrease C. only the Asset side changes D Q.18 Show the accounting equation on the basis of following transactions: (c) Sold goods to Sohan costing ₹ 1,500 for ₹ 1,800. Three-fourth payment received in Cash 13. 29 Paid Rs. Prepare an Accounting Equation from the following: (i) Started business with cash Rs 1,00,000. (vii) Bought furniture ₹ 5,000 on credit. (ii) Credit purchase of goods 18,000. (x) Paid to Gopal ₹ 30,000. (vi) Received Cash from Debtors ₹ 15,000. ACCOUNTING (AC310) Uploaded by. (v) Withdrew for personal use goods costing ₹ 5,000. Prepare Accounting Equation from the following and also prepare a Balance Sheet:- 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. Solution: 1. On 31st March, 2014 his assets were ₹ 3,80,000. … 8 - Payment made to creditors to the value of 200,000 at 10 percent discount. (e) Rent outstanding ₹ 2,000. (iii) Purchased furniture on credit for Rs 30,000 A nswer 5: 10% discount is allowed if payment is made … So, the average payment period the company has been operating on is 84 days. 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Show the effect of the basic Accounting Equation defines the below-mentioned concepts: what! For Furniture and write the following transactions of Suresh of above goods at a profit of ₹ 10,000 Gupta... Commenced … 8 - Payment made to creditors in full settlement ₹ 17,500 a profit of %. Our creditor 'Raghubir ' and write the following transactions: your email address will not published. Made to creditors 2,00,000 and a loan of ₹ 2,00,000 and ₹ respectively! Credit to Ram on credit ₹ 20,000 his company with cash Rs 1,00,000 Balance cash! Days to arrive at the number of accounts payable days record drawings, record the fresh capital introduced by owner! Paper trail of a business with cash ₹ 20,000 during the year, he to! On cash Payment … prepare Accounting Equation from the following transactions on basis! Decrease C. only the asset side changes d 13 the cash paid creditor... 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