ACCT 490 Principles Of Accounting

ACCT 490 Principles Of Accounting

ACCT 490 Principles Of Accounting

accounting

Question:

Q.1 On behalf of your assumption amount make Accounting equation and pass journal entry of all below given transaction in the books of Alnaeem and also make balance sheet on the basis of the last equation.
1.Alnaeem start business with investment of cash assume amount yourself and put in equation and pass journal entry.
2.Alnaeem purchase furniture with cash assume amount yourself and put in equation and pass journal entry.
3.Alnaeem purchase Goods with cash assume amount yourself and put in equation and pass journal entry.
4.Alnaeem purchase Equipment on Account assume amount yourself and put in equation and pass journal entry.
5.Alnaeem receive consulting fees Cash assume amount yourself and put in equation and pass journal entry.

Answer:

Question 1

S.No.T Transaction   Assets Liabilities Equity    
Cash + goods + Furniture Equipment = Revenue  
 
=
1 Investment in business 50000                
Bal. Owner’s equity             50000    
2 Purchase furniture 5000-                
Bal. Furniture     5000            
3 Purchased goods -10000                
Bal. Goods   10000              
4 Purchased equipment -12000                
Bal. Equipment       12000          
5 Received consulting fees 15000                
Bal. Revenue               15000  
  Total 38000 10000 5000 12000 65000   50000 15000 65000

Balance sheet of Alnaeem & company

Particulars Amount Amount
  Assets    
  Current assets    
  Cash (a) 38000  
  Goods (b) 10000  
  Total current assets (c) = (a+b)   48000
  Non-current assets    
  Furniture (d) 5000  
  Equipment (e) 12000  
  Total non-current assets (f) = (d+e)   17000
  Total assets (c+f)   65000
  Liabilities    
  Current liabilities   0
  Non-current liabilities   0
  Total liabilities (g)   0
  Equities    
  Owner’s equity (h) 50000  
  Retained earnings (i) 15000  
  Total equity (j) = (h+i)   65000
  Total liabilities and equities (g+j)   65000

 

Journal entries –

Sl. No. Particulars Debit Credit
  1 Cash a/c…………………….Dr 50000  
    Owner’s equity……………..Cr   50000
    [investment of cash in business]    
         
  2 Furniture a/c………….…….Dr 5000  
    Cash…………………….….Cr   5000
    [Purchased furniture with cash]    
         
  3 Goods a/c…….……….…….Dr 10000  
    Cash…………………..…….Cr   10000
    [Purchased goods with cash]    
         
  4 Furniture a/c…………….….Dr 12000  
    Cash………………….…….Cr   12000
    [Purchased equipment with cash]    
         
  5 Cash a/c…………………….Dr 15000  
    Revenues – consulting fees….Cr   15000
    [Consulting fees received in cash]    

 

ACCT 490 Principles Of Accounting