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Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation?
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Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received ...
Accounting Equation for Goods Sold
Explanation:
Step 1: Identify the transaction
The given transaction involves the sale of goods worth Rs. 20,000 for Rs. 30,000, out of which Rs. 15,000 is received in cash.
Step 2: Identify the accounts affected
The following accounts are affected in this transaction:
- Sales Account: This account records the revenue earned from the sale of goods. In this case, the sales account will be credited for Rs. 30,000.
- Cash Account: This account records the cash received from the sale. In this case, the cash account will be debited for Rs. 15,000.
- Accounts Receivable Account: This account records the credit sales made to customers. In this case, since the entire sale is not received in cash, the accounts receivable account will be debited for Rs. 15,000 (Rs. 30,000 - Rs. 15,000).
- Cost of Goods Sold Account: This account records the cost of goods sold. In this case, since the cost of goods sold is not given, we cannot determine the amount to be debited.
- Inventory Account: This account records the value of goods held for sale. In this case, since the goods are sold, the inventory account will be credited for Rs. 20,000.
Step 3: Apply the accounting equation
The accounting equation is Assets = Liabilities + Equity. In this case, we can assume that there are no liabilities involved and the equity remains the same. Therefore, the accounting equation can be represented as:
Assets = Equity
The effect on assets and equity can be summarized as follows:
- Assets: The cash account is debited for Rs. 15,000 and the inventory account is credited for Rs. 20,000. Therefore, the total assets increase by Rs. 5,000.
- Equity: Since there are no liabilities involved, the increase in assets will also result in an equal increase in equity. Therefore, the equity increases by Rs. 5,000.
Step 4: Prepare the journal entry
Based on the above analysis, the journal entry for the transaction can be prepared as follows:
Sales Account | 30,000
Accounts Receivable Account | 15,000
Inventory Account | 20,000
Cash Account | 15,000
Note: The cost of goods sold account is not included in the journal entry as the cost of goods sold is not given in the transaction.
Conclusion
In conclusion, the accounting equation for the given transaction can be represented as Assets = Equity, and the journal entry for the transaction involves debiting the cash and accounts
Community Answer
Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received ...
Add: cash(15000), debtors(15000) , capital(10000)
sub: stock(20000).
sub: stock(20000).
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Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation?
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Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation?.
Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goods worth Rs.20000/- sold for Rs.30000/- of which Rs.15000 received in cash what is its accounting equation?.
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