sold goods for cash costing Rs 40,000 at a profit of 20% nd on credit costing Rs 72000 at a profit of 25%

cash = + 48000 

goods = - 40000 

goods sold on credit... 

debtors = 90000 

goods = - 72000

any explainations want ??? then tell ... 

  • -5

For Cash:

Cost (Stock decreased) = Rs.40,000

Profit = 20% on Cost = 20% * Rs.40,000 = Rs.8,000

Sales (Cash received) = Rs.40,000+Rs.8,000 = Rs.48,000

.

For Credit:

Cost (Stock decreased) = Rs.72,000

Profit = 25% on Cost = 20% * Rs.72,000 = Rs.18,000

Sales (Debtors-receivable) = Rs.72,000+Rs.18,000 = Rs.90,000

.

.

RESULTS:

1. Total Stock decreased (Credited to Stock A/c-COST) = Rs.40,000+Rs.72,000 = Rs.1,12,000

2. Cah increased (Debited to Cash A/c) = Rs.48,000

3. Debtors increased (Debited to Debtors' A/c) = Rs.90,000

4. Total Profit made (Credited to Capital A/c) = Rs.8,000+Rs.18,000 = Rs.26,000

.

.

ACCOUNTING EQUATION

Assets:

1. Stock decreased = (Rs.1,12,000)

2. Cash increased = Rs.48,000

3. Debtors increased = Rs.90,000

Net Effect           = Rs.26,000             

.

Capital:

1. Capital increased (by Profit figure) = Rs.26,000

.

Liabilities = NIL

.

.

So, Rs.26,000 (Assets) = Rs.26,000 (Capital) + Nil (Liabilities)

=> Rs.26,000 = Rs.26,000

  • 3

For Cash:

Cost (Stock decreased) = Rs.40,000

Profit = 20% on Cost = 20% * Rs.40,000 = Rs.8,000

Sales (Cash received) = Rs.40,000+Rs.8,000 = Rs.48,000

.

For Credit:

Cost (Stock decreased) = Rs.72,000

Profit = 25% on Cost = 20% * Rs.72,000 = Rs.18,000

Sales (Debtors-receivable) = Rs.72,000+Rs.18,000 = Rs.90,000

.

.

RESULTS:

1. Total Stock decreased (Credited to Stock A/c-COST) = Rs.40,000+Rs.72,000 = Rs.1,12,000

2. Cah increased (Debited to Cash A/c) = Rs.48,000

3. Debtors increased (Debited to Debtors' A/c) = Rs.90,000

4. Total Profit made (Credited to Capital A/c) = Rs.8,000+Rs.18,000 = Rs.26,000

.

.

ACCOUNTING EQUATION

Assets:

1. Stock decreased = (Rs.1,12,000)

2. Cash increased = Rs.48,000

3. Debtors increased = Rs.90,000

Net Effect           = Rs.26,000             

.

Capital:

1. Capital increased (by Profit figure) = Rs.26,000

.

Liabilities = NIL

.

.

So, Rs.26,000 (Assets) = Rs.26,000 (Capital) + Nil (Liabilities)

=> Rs.26,000 = Rs.26,000

  • 8

Thank You:)

Cash sales Rs.2000 were not posted rectify the error

  • 4
hy friends i am doing this in my accounts copy but both side are not equal...why it is suggesting me that stock should to be 98000 but in these answers are 112000 what to do
  • -1
Profit on cash 8000
Profit on credit 18000
Total profit 26000
  • -1
40000 ?20 =00000
00008
=80
  • 1
1. Sold goods for cash 40000 with 20% profit for cash,that is,
40000?20/100=8000
That means the goods are sold for Rs. 48000 as 40000+8000
Cash A/c (+) 48000 ; Capital A/c (+) 8000 (profit)
2. Sold goods costing 72000 with a profit of 25 % on credit, that is,
72000?25/100=18000
That means goods are sold for 90000
As 72000+18000
Since, here it is given that the goods are sold on credit so we will make Debtor's A/c on the asset side and (+) 90000 in it also we will add 18000 in the capital A/c because we have gained 25% profit which is rs.18000
  • -1
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