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Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000?
Most Upvoted Answer
Show accounting equation from the following (1) putul started business...
Accounting Equation:
Assets = Liabilities + Owner's Equity
Explanation:
1. Putul started business with cash. 1,00,000
- The transaction increases the asset (cash) and owner's equity by the same amount.
- The accounting equation becomes: Assets = 1,00,000, Owner's Equity = 1,00,000
2. Purchased goods for cash 20,000
- The transaction increases the asset (inventory) and decreases the asset (cash) by the same amount.
- The accounting equation becomes: Assets = 1,20,000 (cash 80,000 + inventory 40,000), Owner's Equity = 1,00,000
3. Sold goods for cash (cost 10,000) 15,000
- The transaction increases the asset (cash) and decreases the asset (inventory) and the cost of goods sold (expense) by the same amount.
- The accounting equation becomes: Assets = 1,25,000 (cash 95,000 + inventory 30,000), Owner's Equity = 1,00,000
Conclusion:
- The accounting equation must always balance, with the total assets equaling the total liabilities and owner's equity.
- Every transaction affects the accounting equation in some way, either by increasing or decreasing assets, liabilities, or owner's equity.
- By keeping track of these changes, businesses can accurately track their financial health and make informed decisions about their operations.
Assets = Liabilities + Owner's Equity
Explanation:
1. Putul started business with cash. 1,00,000
- The transaction increases the asset (cash) and owner's equity by the same amount.
- The accounting equation becomes: Assets = 1,00,000, Owner's Equity = 1,00,000
2. Purchased goods for cash 20,000
- The transaction increases the asset (inventory) and decreases the asset (cash) by the same amount.
- The accounting equation becomes: Assets = 1,20,000 (cash 80,000 + inventory 40,000), Owner's Equity = 1,00,000
3. Sold goods for cash (cost 10,000) 15,000
- The transaction increases the asset (cash) and decreases the asset (inventory) and the cost of goods sold (expense) by the same amount.
- The accounting equation becomes: Assets = 1,25,000 (cash 95,000 + inventory 30,000), Owner's Equity = 1,00,000
Conclusion:
- The accounting equation must always balance, with the total assets equaling the total liabilities and owner's equity.
- Every transaction affects the accounting equation in some way, either by increasing or decreasing assets, liabilities, or owner's equity.
- By keeping track of these changes, businesses can accurately track their financial health and make informed decisions about their operations.
Community Answer
Show accounting equation from the following (1) putul started business...
Cash ac Dr 100000
To capital ac. 100000
To capital ac. 100000
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Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000?
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Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000?.
Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Show accounting equation from the following (1) putul started business with cash. 1,00,000 (2) purchased goods for cash 20,000 (3) sold goods for cash (cost 10,000) 15,000?.
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