# What is the answer of 3(c)

The Accounting Equation for the following transaction would be as follows:

S.No. | Transaction | Assets = Liabilities + Capital Cash + Debtors + Stock = Creditors + Capital |

(c) | Sold goods for cash Rs.40,000 at a profit of 20% and credit costing Rs.72,000 at a profit of 25%. | +48,000 + 90,000 + (1,12,000) = 0 + 26,000 |

Working Notes:

(1) Cash Sales = Cost price of goods sold + Profit

= Rs.40,000 + 20% * Rs.40,000

= Rs.40,000 + Rs.8000 = Rs.48,000

Due to cash sales

**Cash**will increase by Rs.48,000

(2) Credit Sales = Cost price of goods sold + Profit

= Rs.72,000 + 25% * Rs.72,000

= Rs.72,000 + Rs.18,000 = Rs.90,000

Due to credit sales

**Debtors**will increase by Rs.90,000

(3) Total Profit = Profit on cash sales + Profit on credit sales

= Rs.8,000 + Rs.18,000 = Rs.26,000

Due to Profit

**Capital**will increase by Rs.26,000

(4) Stock will decrease by 1,12,000 (Rs.40,000+Rs.72000) i.e; cost price of goods sold on cash and credit basis.

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