CLASS TEST : ACCOUNTING EQUATIONS

Subject: Accountancy
Class: XI B

Q.1 Show the accounting equation on the basis of following transactions:

1) Commenced business with cash Rs.50,000, goods Rs.10,000 and furniture Rs.1,000.
2) Sold goods to Rakesh on credit costing Rs.400 for Rs.500.
3) Paid Rent in advance Rs.500.
4) Salary outstanding Rs.100.
5) Charged 10% depreciation on furniture.
6) Goods destroyed by fire Rs.500.
7) Purchased household goods for Rs.15,000, giving 5,000 in cash and balance through loan.
8) Accrued interest Rs.500.
9) Commission received in advance Rs.1,000.
10) Interest due but not paid Rs.100.
11) Prepaid insurance Rs.700.
12) Interest on capital Rs.1,000.
13) Interest on Drawings Rs.300.
14) Transfer from capital to loan Rs.5000. (15)

Q.2 Mr.Z started a real estate business with a initial cash investment of Rs.21,000. Following transactions
were recorded. Present these in Accounting Equation form and prepare a Balance sheet.
1) Paid three months’ rent in advance for office Rs.1,200.
2) Bought Car for office Rs.12,600.
3) Purchased office furniture Rs.4,200.
4) Bought office typewriter from Standard Supply Co. Rs.1,800.
5) Sold extra office furniture to Amar for Rs.600. Amar paid Rs.360 in cash &balance after 3 months.
7) Amar paid the above amount and Mr.Z paid half the amount he owed to Standard Supply Co.
8) Collected Rs.3,600 as commission.
9) Paid telephone bill Rs.90. (10)

Q.3 Calculate the amount of external equity (liabilities) in each case:

a) On 31.12.01 total assets and capital were Rs.30,000 and Rs.21,000 respectively. (1)
b) On 1.1.01 Mr.X started a business with a capital of Rs.6,000 and a loan of Rs.3,000 borrowed from a
friend. During 2001 he earned a profit of Rs.3,000. On 31.12.01 total assets were Rs.30,000. (2)
c) On 1.1.01 Z started a business with a capital of Rs.6,000 and a loan of Rs.3,000 borrowed from a friend.
During 2001 he earned a profit of Rs.3,000 , introduced an additional capital of Rs.3,600 and had withdrawn
Rs.1800 for his personal use. On 31.12.2001 the total assets were Rs.30,000. (2)