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Recording of Transactions Test - 6

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Recording of Transactions Test - 6
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  • Question 1
    1 / -0

    If total assets of a business are Rs. 550000 and outside liabilities are Rs.250000 Calculate owners equity

    Solution

    The basic accounting equation is :-

    Assets = capital+ Liabilities

    550000= Capital+ 250000

    Capital = 550000-250000

    Capital= 300000

  • Question 2
    1 / -0

    Payment to creditors in cash will affect

    Solution

    Payment to creditor will decrease cash from assets and also the creditor balance from liability goes down . which means assets and liability decreases.

  • Question 3
    1 / -0

    Rohit is a sole proprietor has the following balances: Premises- Rs.55000, Cash at bank- Rs.6500, Inventory – Rs.12500 and creditors- Rs.14000. Find out the amount of capital.

    Solution

    Assets = Premises+ cash at bank + inventories

    Assets = 55000+6500+12500

    Assets = Rs. 74000

    Creditors are liabilities.

    Assets = Liabilities + Capital

    74000= 14000+ Capital

    Capital = 74000-14000

    Capital = 60000Rs.

  • Question 4
    1 / -0

    Salary is an ____ for the employer and _____ for the employee

    Solution

    Salary is expense for employer because Employer pays salary to employee and For Employee it will an income as he receives this amount.

  • Question 5
    1 / -0

    Sumit owns a company and purchase goods on credit from his personal funds and used the same for business purpose. What is the effect on assets

    Solution

    when sumit will intoduce stock in business out of his personal funds then it will increase the stock columm in assets and also the capital get increases. 

  • Question 6
    1 / -0

    By what amount the following transaction should be recorded in the SALES BOOK sold to Babu Furniture House. 200 Tables@Rs.150 each, 100 Chairs@Rs.100 each

    Solution

    Sales book records only credit sale transaction of goods. 

    So Total amount in sale Book will be:-

    Sold to Babu furniture House:-

    200 tables @150= 30000

    100Chairs @100 = 10000

    Total Amount= 40000

    So, Sale book amount will be Rs. 40000

  • Question 7
    1 / -0

    Capital at the end Rs.45,500 and capital in the beginning Rs.50,000. Difference of opening and closing capital is ___

    Solution

    Profit/loss= Capital at end + drawings -  capital at the beginning- Additional capital

    Since there is no drawing and Additional capital ,so 

    Profit/loss = Capital at end- capital at beginning

    Profit/loss= 45500- 50000

    Profit/loss =-4500 Rs.

    Hence there is Loss of 4500rs.

  • Question 8
    1 / -0

    Which of following items will be recorded in the purchase book?

    Solution

    Purchase book records only credit transaction of Purchase. It is one of the subsidiary book . 

  • Question 9
    1 / -0

    Calculate the amount of cash if:  other assets( Except Cash) = Rs.10,000 liabilities= Rs.10,000 Total Capital= Rs.5000

    Solution

    Total Assets = Capital + liabilities

    Total Assets = 5000+ 10000

    Total Assets = Rs. 15000

    Total Assets = Other Assets + Cash

    15000 = 10,000 + Cash

    Cash=  15000- 10000

    Cash =Rs. 5000

  • Question 10
    1 / -0

    Match the following options are as follows:

    a. Personal account

    b. Nominal Account

    c. Real Account

    i. Furniture Account

    ii. ICICI Bank Account

    iii. Salary paid

    Solution

    Nominal account are for expenses and incomes which means salary paid is related to nominal account.

    Real account are related to assets which means furniture is related to real account.

    Personal account are in the name of person which means ICICI bank is related to personal account.

  • Question 11
    1 / -0

    A business had net assets at 1 January and 31December 2012 of Rs.75,600 and Rs.73,800 respectively. During the year, the proprietor introduced additional capital of Rs. 17700 and withdrew cash and goods to the value of Rs.16300.What profit or loss was made by the business in 2012

    Solution

    Profit/ Loss= Closing Capital + Drawing - opening Capital - Additional capital

    Profit/Loss =73800+16300- 75600-17700

    Profit/Loss = 90100-93300

    Profit/loss = -3200

    Which means there is a loss of Rs. 3200 .

  • Question 12
    1 / -0

    Calculate Return Inward Journal (Book) from the following transactions of M/s Bansal Electronics for November 2010:

    (a) M/s Gupta Traders returned the goods Rs.1,500

    (b) Goods returned from M/s Harish Traders Rs.800

    (c) M/s Rahul Traders returned the goods not as per specifications amounting to Rs. 1200

    (d) Goods returned from Sushil Traders Rs.1,000. Options are as follows

    Solution

    Return inward book records all entry of credit sale return of goods.

    So, Goods Returned are = Rs. 1500+ 800+ 1200+ 1000

     = Rs. 4500

  • Question 13
    1 / -0

    If assets = Rs. 60000 and liabilities = Rs.25000, What is the capital in the business?

    Solution

    The basic accounting equation says:-

    Assets = Liabilities + capital

    60000 =25000+ Capital

    Capital = 60000-25000

    Capital =Rs. 35000

  • Question 14
    1 / -0

    Goods costing Rs. 20000 have sold for cash at 25 % profit. By what amount cash will increase

    Solution

    Sale amount = Cost + Profit

    Sale = 200000+ 25℅ of Cost

    sale = 200000+50000

    Sale = 250000

    All sale is in cash. So Cash Balance will increase by Rs. 250000. 

  • Question 15
    1 / -0

    If total assets of a business are Rs.150000 and capital is Rs.130000.Calculate outside liabilities

    Solution

    The basic accounting Equation is:- 

    Assets = Capital + Liabilities

    150000= 130000+ Liabilities

    Liabilities= 150000-130000

    Liabilities= 20000

  • Question 16
    1 / -0

    Decrease in ____ is debited

    Solution

    Liability are in the credit nature and creditors are also liability which increase from credit and decrease with debit. So when we paid them they will goes down which means liability goes decrease by debiting them.

  • Question 17
    1 / -0

    If Cash= Rs.1000; inventories= Rs.4000 Debtors= Rs.5000; fixed assets=? Capital + Liabilities= Rs.18000. Find out the Amount of fixed assets?

    Solution

    Total assets = capital + Liability

    Total assets = Rs. 18000

    Now, 

    Current assets = Cash + inventories+ Debtors

    Current assets = 1000+4000+5000

    Current assets = 10000

    Total Assets = current Assets + Fixed Assets

    18000= 10000+ Fixed Assets

    Fixed Assets = 18000 -10000

    Fixed Assets = Rs. 8000

  • Question 18
    1 / -0

    Calculate purchase return amount from the following transactions for January 2011.

    (a) Returned goods to M/s Kartik Traders Rs.1,200

    (b) Goods returned to Sahil Pvt. Ltd. Rs.2,500

    (c) Goods returned to M/s Kohinoor Traders for list price Rs.2, 000 less 10% trade discount.

    (d) Return outwards to M/s Handa Traders Rs.550. Options are as follows

    Solution

    purchase Return Book Records transaction of credit return of purchase.

    So Purchase return Amount= Rs. 1200 + Rs. 2500 +(Rs. 2000- 10% Discount) +Rs. 550


    = Rs. 1200+ Rs. 2500 +Rs. 1800 +Rs. 550

    = Rs. 6050

  • Question 19
    1 / -0

    Find out the value of assets if: Liabilities= Rs.5000 and Capital= Rs.1000

    Solution

    Assets = Capital + liabilities

    Assets =1000 + 5000

    Assets = Rs. 6000

  • Question 20
    1 / -0

    The capital of a business is Rs.300000 and outside liabilities are Rs.250000. Calculate total assets of the business

    Solution

    The basic accounting equation is:-

    Assets = Capital + Liabilities 

    Assets = 300000+250000

    Assets = 550000

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