# Class-11th | Chapter-2 | Accounting Equation | Question No. 16 to 20 | Ts grewal solution | 2020-21

#### Question 16:

Prepare Accounting Equation from the following:
(a) Started business with cash  ` 1,00,000.
(b) Purchased goods for cash  ` 20,000 and on credit  ` 30,000.
(c) Sold goods for cash costing  ` 10,000 and on credit costing  ` 15,000 both at a profit of 20% .
(d) Paid salaries  ` 8,000.

 S. No. Transactions Assets = Liabilities + Capital Cash ( `) + Stock ( `) + Debtors ( `) Creditors ( `) ( `) (i) Started business with cash 1,00,000 1,00,000 1,00,000 = 1,00,000 (ii) Purchased goods for Cash  ` 20,000 and on credit  ` 30,000 – 20,000 + 50,000 = 30,000 80,000 + 50,000 = 30,000 + 1,00,000 (iii) Sold goods for cash costing  ` 10,000 and on credit costing  ` 15,000 both at profit of 20% 12,000 + – 25,000 + 18,000 5,000 (Profit) 92,000 + 25,000 + 18,000 = 30,000 + 1,05,000 (iv) Paid Salaries  ` 8,000 – 8,000 – 8,000 (Expenses) 84,000 + 25,000 + 18,000 = 30,000 + 97,000

 Assets = 84,000 + 25,000 + 18,000 = ` 1,27,000 Liabilities = ` 30,000 Capital = ` 97,000

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#### Question 17:

Show the accounting equation on the basis of following transactions:
(a) Ram started business with  ` 25,000.
(b) Purchased goods from Shyam  ` 10,000.
(c) Sold goods to Sohan costing  ` 1,500 for  ` 1,800.

 S. No. Transaction Assets = Liabilities + Capital Cash + Stock + Debtors = Creditors (i) Ram Started Business with Cash 25,000 + 25,000 (ii) Purchased Goods from Shyam + 10,000 10,000 New A/c Equation 25,000 + 10,000 = 10,000 + 25,000 (iii) Sold Goods to Sohan costing  `1,500 for  `1,800 (-)1,500 + 1,800 + 300 (Profit) 25,000 + 8,500 + 1,800 = 10,000 + 25,300

#### Question 18:

If the capital of a business is  ` 3,00,000 and liabilities are  ` 50,000, loss  ` 70,000, calculate the total assets of the business.

 Total Assets = Capital – Loss + Liabilities = 3,00,000 – 70,000 + 50,000 = ` 2,80,000

#### Question 19:

If total assets of a business are  ` 1,30,000 and net worth is  ` 80,000, calculate the creditors.

 Creditors = Total Assets – Net worth = 1,30,000 – 80,000 = ` 50,000

#### Question 20:

A commenced his cloth business on 1st April, 2018 with a capital of  ` 30,000. On 31st March 2019, his assets were worth  ` 50,000 and liabilities of  ` 10,000. Find out his closing capital and profits earned during the year.

 Closing Capital = Assets – Liabilities = 50,000 – 10,000 = ` 40,000

 Profit = Closing Capital – Opening Capital = 40,000 – 30,000 = ` 10,000