Question:

Marks: 10

Show the effect of the following transactions upon the Accounting Equation;
2007.
Feb. 1. Salman started his business with cash Rs.1, 00,000
5. Purchased furniture for cash Rs.4, 000
6. Purchased goods for cash Rs.25, 000
10. Paid transportation on goods purchased Rs.1, 000
12. Sold goods for cash Rs.15, 000, costing Rs.11, 000
15. Purchased goods on credit basis for Rs.15, 000
19. Sold goods to Rashid on credit basis for Rs.8, 000. Costing Rs.6, 500
25. Received cash from Rashid Rs.4, 000
28. Cash paid to creditor Rs.9, 000
29 Paid rent and salaries for the month Rs.4, 000

Accounting Equation
Date

Assets
cash

Furniture

Goods

Debtors

=Liabilities + Owner’s Equity
Creditors
Capital

Balances