# Question No 19 Chapter No 8 – T.S. Grewal 11 Class

Question No. 19 - Chapter No.8 - T.S. Grewal +1 Book 2019

Question No 19 Chapter No 8

On 1st April 2018 the position of Tendulkar was as follows: Stock in trade Rs 2,88,000; Bills Payable Rs 48,000: Cash in Bank Rs 2,16,000; Plant and Machinery Rs 1,20,000; Owing by Debtors Rs 60,000; Owing to Creditors Rs 96,000; Investment Rs 2,40,000. Loan from S.K. Garg Rs 1,80,000. What was the amount of Tendulkar’s capital on the date ? Show an opening Journal entry.

### Solution of Question No 19 Chapter No 8: –

So to solve this question first we have to prepare the working Note shown as below:

To Calculate the amount of capital we should use the following formula.

“Capital = Total Assets – Total Liabilities”

To apply this formula we have to recognise the assets and liabilities accounts first. This is shown below: –

Name of Accounts Type of AccountDebit/ CreditReason of Debit/Credit
Stock in Trade A/cAssetDebit All assets always have debit balance.
Bills Payable A/cLiabilityCredit B/P is Liability for the business So, All Liabilities are always have Credit balance
Cash at Bank A/cAssetDebitAll assets always have debit balance
Plant & Machinery A/cAssetDebitAll assets always have debit balance
Qwing by debtors (Sundry Debtors)AssetDebitAll assets always have debit balance
Owing to creditors (Sundry Creditors)LiabilityCredit All Liabilities are always have Credit balance
Investment A/cAssetDebitAll assets always have debit balance
Loan From S.K. Garg Liability CreditAll Liabilities are always have Credit balance

Note: You did not need to prepare above table in the exam, Because this is just for your understanding.

Total Assets = 288000+216000+120000+60000+240000

Total Assets = 9,24,000/-

Total Liabilities = 48000+96000+180000

Total Liabilities = 3,24,000/-

So,

Capital = 9,24,000- 3,24,000

Capital = 6,00,000/- Ans.

Now Post this in the Journal day book: –

In the Books of Rahman

 Date Particulars L.F. Debit Credit 1st April,2018 Stock in Trade A/c Dr. 2,88,000 Cash at Bank A/c Dr. 2,16,000 Plant & Machinery A/c Dr. 1,20,000 Sundry Debtors A/c Dr. 60,000 Investment A/c Dr. 2,40,000 To Bills Payable A/c 48,000 To Sundry Creditors A/c 96,000 To S.K. Garg Loan’s A/c 1,80,000 To Capital A/c(See W.Note) 6,00,000 (Being opening balances of last year brought forward in current year )