Question

Prepare the Accounting Equation from the following transactios :
1. Sachin started business and introduced capital ₹70,000.
2. Purchased goods in cash ₹50,000.
3. Purcahsed funiture form M/s Samrat Furniture ₹20,000.
5. Paid M/s Samrat Furniture in cash.

Answer 1

Note : 1 The transaction with M/s Samart Furniture (₹ 20,000) is a credit transaction since it is not stated to be cash payment.
2. Sale of goods have resulted in a profit of ₹10,000. It has been added to capital because net profit at the year end is transferred to Capital Account.