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    Accounting Equation & Journal

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    Shilpa Minhas
    The document discusses accounting transactions for a business owner named A. It shows A starting the business with Rs. 100,000 cash, purchasing furniture for Rs. 50,000 cash, and purchasing goods for Rs. 10,000 cash and Rs. 20,000 on credit. It also records rent paid of Rs. 5,000 and goods sold for Rs. 10,000 cash. The accounting equation of assets equaling liabilities plus owner's equity is displayed after each transaction to show the impact. The document also includes sample journal entries and descriptions of key accounting accounts like goods account.

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    Accounting Equation & Journal

    Uploaded by

    Shilpa Minhas
    27 views8 pages
    The document discusses accounting transactions for a business owner named A. It shows A starting the business with Rs. 100,000 cash, purchasing furniture for Rs. 50,000 cash, and purchasing goods for Rs. 10,000 cash and Rs. 20,000 on credit. It also records rent paid of Rs. 5,000 and goods sold for Rs. 10,000 cash. The accounting equation of assets equaling liabilities plus owner's equity is displayed after each transaction to show the impact. The document also includes sample journal entries and descriptions of key accounting accounts like goods account.

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    Original Title

    accounting JOURNAL

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    The document discusses accounting transactions for a business owner named A. It shows A starting the business with Rs. 100,000 cash, purchasing furniture for Rs. 50,000 cash, and purchasing goods for Rs. 10,000 cash and Rs. 20,000 on credit. It also records rent paid of Rs. 5,000 and goods sold for Rs. 10,000 cash. The accounting equation of assets equaling liabilities plus owner's equity is displayed after each transaction to show the impact. The document also includes sample journal entries and descriptions of key accounting accounts like goods account.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as ppt, pdf, or txt
    27 views8 pages

    Accounting Equation & Journal

    Uploaded by

    Shilpa Minhas
    The document discusses accounting transactions for a business owner named A. It shows A starting the business with Rs. 100,000 cash, purchasing furniture for Rs. 50,000 cash, and purchasing goods for Rs. 10,000 cash and Rs. 20,000 on credit. It also records rent paid of Rs. 5,000 and goods sold for Rs. 10,000 cash. The accounting equation of assets equaling liabilities plus owner's equity is displayed after each transaction to show the impact. The document also includes sample journal entries and descriptions of key accounting accounts like goods account.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
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    of 8

    Accounting equation &

    Journal
    Accounting equation &
    Transaction Analysis.

     Liabilities = Assets
     Owner’s Equity + Outsider’s Equity
    = Assets
    A starts business with a capital of Rs.
    100,000
    capital + liabilities = Assets
    A’s capital+ - = Cash
    1,00,000 + - =1,00,000

    Purchased furniture for Rs. 50,000


    For cash
    capital + liabilities = Assets
    A’s capital+ = Cash+Furniture
    1,00,000 + - = 1,00,000
    = -30,000 +30,000
    1,00,000 + - = 70,000+ 30,000
    Purchased goods on cash worth Rs.
    10,000
    capital + liabilities = Assets
    A’s capital+ = Cash+Furniture+Goods
    1,00,000 + - = 70,000+ 30,000
    = -10,000+ - +10,000
    1,00,000 + - = 60,000 +30,000+10,000

    Purchased goods on credit worth Rs.


    20,000
    capital + liabilities = Assets
    A’s capital+ creditors = Cash+Furniture+Goods
    1,00,000 + - = 60,000 +30,000+10,000
    + 20,000 = +20,000
    1,00,000 + 20,000 = 60,000 +30,000+30,000
    Rent paid Rs. 5,000
    capital + liabilities = Assets
    A’s capital+ creditors = Cash+Furniture+Goods
    1,00,000 + 20,000 =60,000+30,000+30,000
    -5,000 =-5,000
    95,000 + 20,000 = 55,000+30,000+30,000

    Sold goods for cash for Rs. 10,000


    capital + liabilities = Assets
    A’s capital+ creditors = Cash +Furniture+Goods
    95,000 + 20,000 = 55,000+30,000+30,000
    =+10,000 -10,000

    95,000 + 20,000 = 65,000+30,000+20,000


    Question
    Show accounting equation
     Commenced business with cash Rs. 50,000,
    goods Rs. 10,000 & furniture Rs. 1,000.
     Sold goods to R on credit costing Rs. 400 for Rs.
    500.
     Paid rent in advance Rs. 100.
     Salary outstanding Rs. 100.
     Charged depreciation of Rs. 100 on furniture.
     Goods destroyed by fire Rs. 500.
     Purchased household goods for Rs. 15,000,
    giving Rs. 5,000 in cash & balance through a
    loan.
    Format of journal

    Date Particulars Debit Credit


    L.F. (Amt. In Rs.) (Amt. In Rs.)
    Goods Account
    Articles purchased by business for resale.

    Purchases Sales Purchases Sales


    Account Account returns returns
    (debited) (credited) Account Account
    (credited) (debited)

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