Accounting Equations

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  • Topic: Furniture, Discounts and allowances, Bank
  • Pages : 5 (1341 words )
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  • Published : March 26, 2013
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ACCOUNTING EQUATIONS
1. Show the accounting equation for the following transaction (i) Ram started business with cash 20000, stock 50000, building 30000 (ii) Sold goods to Amit for cash 20000 and credit 15000 (iii) Paid rent 500 and rent outstanding 150

(iv) Sold goods costing 12000 for Rs. 15000
(v) Accrued commission 2000
(vi) Furniture purchased from Lalit 12000 and paid 3000 in cash (vii) Received from Amit 13500 in full settlement
(viii) Insurance paid 15000 for 15 months
(ix) Commission received in advance 400
(x) Cash deposited into saving bank a/c 7000
(xi) Building purchased and paid by cheque 5000
(xii) Paid to Lalit Rs.8500 in full settlement
2. Ashita began a business as wholesaler of gloves, scarves and caps. The following events have occurred: (i) On January 1 2003, she invested Rs.1,50,000 in cash in her new business called “Winter Gifts” (ii) Acquired Rs.20,000 goods for cash.

(iii) A large retail store in Chandigarh, which she hoped would be a big customer, closed its business. (iv) Gloves that cost Rs.300 in transaction (ii) were of wrong style. She returned them and obtained a full cash refund.

(v) She sold her personal savings certificates for Rs.4,000 to acquire machinery for “Winter Gifts”. (vi) She paid two months’ rent in advance for her office Rs.5,000 Show the effect of the above transactions on the accounting equation. 3. A summary of the transactions of the business of Suresh are as follows:- Please explain the same in form of equations. 2008

March 1) Suresh began business with Rs. 50,000 in cash. 2) Took a loan of Rs. 20,000 from Manish.
3) Purchased for cash, two computers each costing Rs. 29,000. 4) Purchased supplies of floppy disks and stationery for Rs. 6,000/- on credit. 19) Received a price of Rs. 12,000 in cash for software services. 21) Paid creditor for supplies of Rs. 2,000

29) Paid salaries to employees Rs. 4,000/- and office rent Rs. 1,200/- 30) Deposited Rs. 10,000 in Bank.
31) Withdrew Rs. 3,500 in cash for personal use.
31) Paid Rs. 2,000 in cash for employees general insurance. 4. Ram started business with 10,000, paid into bank 7000, bought goods for cash 500, drew cash from bank for credit 100, sold goods to Krishna goods on credit 150, bought from Shyam goods on credit 225, received from Krishna 145 allowed him discount 5, paid Shyam cash 215 discount allowed 10, cash sales for the month 800, paid rent 50 and paid salary 100. 5. Ramgopal started business with cash 8000.

He bought goods for cash 5000.
He sold goods worth Rs. 300 for Rs. 400 to Mr. Manoharlal.
Paid into bank Rs. 3000.
Bought goods from Mr. Hari Rs. 225.
Paid cash to Hari Rs. 215, discount allowed by him Rs. 10
Sold goods worth Rs. 400 for Rs. 450 for cash to Mr. Murali. Received cash from Manohar lal Rs. 360 in full & final settlement, Paid for stationary Rs. 30
Paid for office furniture Rs. 200,
Sold goods worth Rs. 90 to Mr. Kailash for Rs. 100.
electricity charges Rs. 150.
Received from Kailash Rs. 95.

6. Raju commenced business with cash Rs. 30000
Deposited Rs. 25000 into bank
Purchase goods for cash Rs. 12000, credit from Mr. X Rs. 18000 Sold goods for cash Rs. 24000 costing Rs. 18000
Paid rent 300 and rent outstanding Rs. 60
Bought furniture Rs. 3000 on credit from Durian Furniture.
Bought refrigerator for personal use Rs. 3000
Purchase building Rs. 12000
Withdrew Rs. 9000 in cash from bank and invested Rs. 4500 in shares of XY & Co. Purchase a second-hand two wheeler for staff Rs. 9000 giving Rs. 3000 in cash and balance through a loan. Sold shares costing Rs. 600 for Rs. 900

Paid Rs. 300 for loan and Rs. 180 for interest
Received cash for dividends on shares Rs. 120.

7. Shriram commenced business with cash Rs. 30000, stock Rs. 5000 and building Rs. 50000 Paid rent in advance Rs. 1200
Purchase...
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