Develop an Accounting equation.
1. Keshav started business with cash 100000, stock 50000 and furniture 10000.
2. Purchased a plant for 20000.
3. Purchased goods for cash 35000 and on credit from X 25000.
4. Sold goods for 21000 (cost 19000).
5. Purchased securities for 12000.
6. Sold furniture costing 4000 for 3500.
7. Sold good to Mohan for 15000( cost 12000 ).
8. Purchased a house for 25000 paying 10000 for cash and balance through a loan.
9. Goods purchased from A for 4000.
10. 50%of goods purchased from A sold for 2500.
11. Sold securities for 9000 ( cost 8000 ).
12. Received interest on securities 600.
13. Rent @200 per month. Rent is paid on 1st day on next month.
14. Salaries paid 3000 and outstanding 600.

Dear Student,

The solution to your query is provided below:
 
S. No. Transaction Assets = Liabilities + Capital
Cash + Plant + Stock + Furniture + Securities   Mohan   House = Creditors + House Loan   O/s Expense    
(i) Commenced business 1,00,000       50,000   10,000             =             1,60,000
    1,00,000       50,000   10,000             =             1,60,000
(ii) Purchased a plant (-)
20,000
  (+) 20,000                                    
    80,000   20,000   50,000   10,000             =             1,60,000
(iii) Purchased goods (-) 35,000       (+) 60,000                   (+) 25,000            
    45,000   20,000   1,10,000   10,000             = 25,000           1,60,000
(iv) Sold Goods 21,000       (-) 19,000                               (+) 2,000 Profit
    66,000   20,000   91,000   10,000             = 25,000           1,62,000
(v) Purchased Securities (-) 12,000               (+) 12,000                        
    54,000   20,000   91,000   10,000   12,000         = 25,000           1,62,000
(vi) Sold furniture (+) 3,500           (-) 4,000                           (-) 500 Loss
    57,500   20,000   91,000   6,000   12,000         = 25,000           1,61,500
(vii) Sold Goods to Mohan         (-)
12,000
          (+) 15,000                   (+) 3,000
Profit
    57,500   20,000   79,000   6,000   12,000   15,000     = 25,000           1,64,500
(viii) Purchased house (-) 10,000                       (+) 25,000       (+) 15,000        
    47,500   20,000   79,000   6,000   12,000   15,000   25,000 = 25,000   15,000       1,64,500
(ix) Goods purchased from A         (+) 4,000                   (+) 4,000            
    47,500   20,000   83,000   6,000   12,000   15,000   25,000 = 29,000   15,000       1,64,500
(x) Sold 50% goods purchased from A (+) 2,500       (-) 2,000                               (+) 500 Profit
    50,000   20,000   81,000   6,000   12,000   15,000   25,000 = 29,000   15,000       1,65,000
(xi) Sold securities (+) 9,000               (-) 8,000                       (+) 1,000 Profit
    59,000   20,000   81,000   6,000   4,000   15,000   25,000 = 29,000   15,000       1,66,000
(xii) Received interest on securities (+) 600                                       (+) 600 Interest
    59,600   20,000   81,000   6,000   4,000   15,000   25,000 = 29,000   15,000       1,66,600
(xiii) Rent paid @ Rs 200 per month* (-) 2,200                                   (+) 200   (-) 2,400 Expense
    57,400   20,000   81,000   6,000   4,000   15,000   25,000 = 29,000   15,000   200   1,64,200
(xiv) Salaries paid and outstanding (-) 3,000                                   (+) 600   (-) 3,600
    54,400   20,000   81,000   6,000   4,000   15,000   25,000 = 29,000   15,000   800   1,60,600
                                             

*Since rent is paid on the first day of the next month, the rent for Dec/Mar (depending upon the accounting year) will be paid on Jan 1/April 1. Thus, cash will be reduced only to the extent of rent of 11 months and 1 month rent will be considered outstanding at the end of accounting year.

Hope this answers your query.
Keep posting!!

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