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. ,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. 1) 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. . 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. 5000 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. 20. 7. Shriram commenced business with cash Rs. 30000, stock Rs. 5000 and building Rs. 50000 Paid rent in advance Rs. 1200 Purchase typewriter Rs. 4200 Bought furniture from Mohan on credit Rs. 1800 Purchase goods from Sohan for cash Rs. 21000 Sold goods to Shyam for cash Rs. 30000 costing Rs. 24000 Bought goods from Ramesh Rs. 28000 Shyam paid Rs. 23500 in full & final settlement. Purchase furniture for Rs. 9000 giving Rs. 1500 in cash and balance through a loan Goods destroyed by fire cost Rs. 300 sale price Rs. 360 Paid half the amount owed to Mohan Sold goods to Ramu for cash Rs. 30000 costing Rs. 4000 Withdrew goods for personal use cost Rs. 300 sale price Rs. 360 Received Rs. 29700 from Ramu in full settlement of his account Paid Rs. 27820 to Ramesh in full settlement Charge depreciation Rs. 180 on furniture 8. The followings are the assets of a business established 10 years back on 1 April 2010: Cash Rs. 1200, Bank Rs. 40800, Stock Rs. 24000, Machinery Rs. 60000, Furniture Rs. 6000 Narayan Bros Rs. 9000, B K Bros Rs. 15000, The following are the liabilities as on that date: Loan Rs. 30000, JK Bros Rs. 12000 The following transactions occurred during the year: Bought goods on credit from SN & Co.
Rs. 6000 Sold goods for cash to Dhiraj Rs. 2400 Sold goods to Narayan Bros on credit Rs. 6000 Received from Narayan Bros in full settlement of the amount due Rs. 8700 Payment made to JK Bros by cheque Rs. 5850. They allowed them discount Rs. 150 Old furniture sold for cash Rs. 600 Bought goods for cash Rs. 4500 B K Bros paid by cheque. Cheque was deposited into the bank Rs. 15000 Paid for repairs to machinery Rs. 600 Bought goods from JK Bros Rs. 6000. Paid carriage on these goods Rs. 300 Received cheque from Narayan Bros. Deposited in the bank Rs. 5700, discount allowed to them Rs. 00 Paid cheque to JK Bros Rs. 6000. Bank intimated that the cheque of Narayan Bros has returned unpaid. Sold goods worth Rs. 2000 for cash Rs. 3000 Withdrew for private use Rs. 150 9. On December 1, Mr. X purchased second hand machinery from Mr J 30000 against a cheque and spent Rs. 300 on its cartage and Rs. 700 on its installation and Rs. 4000 on its repairs December 3 Paid income tax Rs. 2000 December 16 paid insurance in advance Rs. 1600 December 18 Paid rent of building Rs. 12000, half of the building is used by the proprietor for residential use December 20 Paid life insurance premium Rs. 000 December 26 Goods worth Rs. 2000 and cash Rs. 1000 taken away by the proprietor. December 31 Rent due to land lord Rs. 1000 December 31 Due to clerk Rs. 500 Dece,ber 31 Provide depreciation on the same machinery on 20% pa. 10. April 1 Mr. Singh owes Mr. Robert 15000. On the same day Mr. Harmeet owed Mr. Singh 20000. April 4 Mr. Robert sold goods worth 60000 on trade discount 10% to Mr. Singh. April 6 Mr. Singh sold goods worth Rs. 27,000 to Mr. Harmeet priced at Rs. 30000. April 17 Purchase of Rs. 25000 worth of goods from Robert which was sold to Harmeet at a profit Rs. 5000. April 18 Mr.
Singh rejected 10% of Robert’s goods for being defective. April 19 Mr. Singh issued a cash bill of Rs. 10000 to Mr. Harmeet who came personally for this assignment of goods urgently needed by him. April 22 Mr. Harmeet cleared half his amount by cheque, due to Mr. Singh enjoying a half % cash discount April 26 Roberts’s total dues were cleared by cheque enjoying a cash discount of Rs. 1000 on the payment made. April 29 Closed Harmeet’s account to record the fact that all but Rs. 5000 was cleared by him by cheque because he was declared insolvent Evaluate the transactions in the books of Mr. Singh using accounting equation.
The post Accounting Equations appeared first on Academic Pals.
WE WRITE ESSAYS FOR STUDENTS
Tell us about your assignment and we will find the best writer for your paperWrite My Essay For Me