Question No 16 Chapter No 5 – T.S. Grewal 11 Class

Question No.16 - Chapter No.5- T.S. Grewal +1 Book 2019

Question No 16 Chapter No 5

16. Show an Accounting Equation for the following Transactions:

(i) D. Mahapatra Commenced business with cash Rs 50,000 and Rs. 1,00,000 by cheque, goods Rs 60,000 machinery Rs 1,00,000 and Furniture Rs 50,000.

(ii) 1/3rd of the above goods sold at profit of 10% on cost and half of the payments received in cash.

(iii) Depreciation on machinery provide @ 10%

(iv) Cash withdrawn for personal use Rs 10,000

(v) Interest on drawings charged @ 5%

(vi) Goods sold to Gupta for Rs 10,000 and received a Bill receivable for the same amount for 3 months.

(vii) Received Rs 10,000 from Gupta against the bills Receivable on its maturity.

Solution of Question No 16 Chapter No 5: –

Note: “Becasue we less width so we have deleted column of Particulars but you have to make it in the paper or in your note book.” 

S. No.  Assets
Liab.
Capital
Cash  +Bank +Stock +Machi. +Furn +Debt.
+B/R
 
(i) +50000 +100000 +60000 +100000 +50000       +360000
  50000 +100000 +60000 +100000 +50000 +360000
(ii) +11000 -20000 +11000     +2000
  61000 +100000 +40000 +100000 +50000 +11000 –   – +362000
(iii) -10000     -10000
  61000 +100000 +40000 +90000 +50000 +11000  –  – +352000
(iv) -10000     -10000
  51000 +100000 +40000 +90000 +50000 +11000  –  – +342000
(v)    

-500

+500

  51000 +100000 +40000 +90000 +50000 +11000  –  – +342000
(vi) -10000 +10000    
  51000 +100000 +30000 +90000 +50000 +11000 +10000  – +342000
(vii) +10000 -10000
  61000 +100000 +30000 +90000 +50000 +11000 +342000

Answer: –

Assets: – Cash 61,000 + Bank 1,00,000 + Stock 30,000 + Machine 90,000 + Furniture 50,000 + Debtors 11,000 = 3,42,000/-

Liabilities: – 0/-

Capital = 3,42,000/-

Liabilities  +Capital

0 + 3,42,000 = 3,42,000/-

Explanation of All Transactions with images: –

This is not a part of the solution, So you don’t have to write it in the exam. So why we explained if it is not needed. Because This explanation will help you to understand all transactions with logic so don’t need to remember all the transactions but just understand and remember the logic use behind it.

Transaction No. 1 

Transaction No. 1 Question No.16 Chapter No.5 T.S. Grewal 1 Book 2019 - Question No 16 Chapter No 5 - T.S. Grewal 11 Class
Transaction No. 1 Question No.16 – Chapter No.5- T.S. Grewal +1 Book 2019

As we discuss in the previous topic, A owner and the business both have a separate identity in the eye of law. So, the business will be treated as an Artificial Person and anything invested by the owner into the business will be treated as capital.
So, In this transaction, as shown in the above image owner investing her cash into the business, this will be treated as capital of the business. The business receiving an assets i.e. cash, bank, stock, machine and Furniture.

Transaction No. 2

Transaction No. 2 Question No.16 Chapter No.5 T.S. Grewal 1 Book 2019 - Question No 16 Chapter No 5 - T.S. Grewal 11 Class
Transaction No. 2 Question No.16 – Chapter No.5- T.S. Grewal +1 Book 2019

In this transaction, as shown in the above image four accounts are involved i.e. Stock(Sale), Cash, Debtors  and Capital(Profit):

  • Stock a/c (Sale):- Because business giving(selling) its goods.
  • Cash : – Because Business received cash from customer.
  • Debtors: – Because half of the payment is yet not received. It will be our new asset.
  • Capital(Profit): Because owner has right on all profit of the business so the amount of the profit will be added in the capital a/c. (Profit = sale price – cost price) 22,000-20,000 = 2,000(Profit)

Transaction No. 3

Transaction No. 3 Question No.16 Chapter No.5 T.S. Grewal 1 Book 2019 - Question No 16 Chapter No 5 - T.S. Grewal 11 Class
Transaction No. 3 Question No.16 – Chapter No.5- T.S. Grewal +1 Book 2019

In this transaction, as shown in the above image two accounts are involved i.e. Machine and Capital: 

  • Machine a/c :- Amount of Depreciation deducted from the Machine account, Because book value of machine of reduced.
  • Capital a/c : – Amount of Depreciation deducted from the capital account, Because all expenses and losses are wear by the owner.

 Transaction No. 4

Transaction No. 4 Question No.16 Chapter No.5 T.S. Grewal 1 Book 2019 - Question No 16 Chapter No 5 - T.S. Grewal 11 Class
Transaction No. 4 Question No.16 – Chapter No.5- T.S. Grewal +1 Book 2019

In this transaction, as shown in the above image two accounts are involved i.e. one is cash and another is capital.

  • Cash a/c: – payment is made in cash.
  • Capital a/c:-  cash withdrawal by the owner

Transaction No. 5

Transaction No. 5 Question No.16 Chapter No.5 T.S. Grewal 1 Book 2019 1 - Question No 16 Chapter No 5 - T.S. Grewal 11 Class
Transaction No. 5 Question No.16 – Chapter No.5- T.S. Grewal +1 Book 2019

In this transaction, as shown in the above image one accounts is involved for two time  i.e. capital.

  • Capital a/c: – addition in capital because business earned income.
  • Capital a/c:-  subtracted from capital because owner have to pay this amount to business. 

Transaction No. 6

Transaction No. 6 Question No.16 Chapter No.5 T.S. Grewal 1 Book 2019 1 - Question No 16 Chapter No 5 - T.S. Grewal 11 Class
Transaction No. 6 Question No.16 – Chapter No.5- T.S. Grewal +1 Book 2019

In this transaction, as shown in the above image one accounts is involved for two time  i.e. capital.

  • Capital a/c: – addition in capital because business earned income.
  • Capital a/c:-  subtracted from capital because owner have to pay this amount to business. 

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