\ f Jrrn Delhi I

I'lie--
. , u:.:. Sdwol
-
f ,crcisc

Fill in thecosting
If goods blanks:' 6,000 are sold for ' , .~oo II I (,,l h. ti lf.!r) ( ,:1p11 -11 ~,,11
r t ?-,,e
) Rent of ' 3,000 Paid will lead to decre~se rn "

( ii) An Accoun rn9 ,

i· l t· · Equation is based on the tl "-' l'r1r1cir,1,..
~
t:P Accep ance
t liability
another in·11sthePayable
of s, form ofwill
__ decrease
_ ·a ltabrlrt, 111 th,, fr,rrri ,,f

(v) Goods purchased on credit will lead to

(vi) The equity of lhe owners is called ~ -
(vii) Assets are equal to r \>i-..-.t._ Plus ~ I ,t" . tr1 , , Ir"-" '>rirf '-r,,rJil(,r-,.
(v11i) The equity of the creditors is called ~ ~

Multiple Choice Questions (MCQs)

1. Which equation is correct out of the following?
(a) Capital - Assets+ Liabilities

~➔
2 A
Jer Capital - Assets - Liabilities (b) Lia bii it ie s t,:;:; ets Capital
. mount withdrawn by proprietor ap, a
10r Personal u~e Wrll
. ,,.... D • (d) A,,'.;ets =a L obrlrtie• _ c- r-
(c) Not
.,., change
ecrease (b) lncroa,~
---- 1·
_ ca:.h and capiial

~ ~
3. ·x· •
. cornrnenced bu s1ness on 1" April (d) None of the abcvs
20
his assets Were Worth 8 oo ooo a dr 8 With a capital o1 ? G,00,000 On 'J ,-, r,1arr h 2c P
4 (a)
(c) rr 5,[Link]
2,00,000 ' ' n ra rlrties Z 50,ooo Find out his closing car,; ,,/· •
(bJ t 7,so,ooo •

, Which equation is . (d) None of the above. 1

(a) Liabilities" A::c~rrect ou_tOf lhe lollowing?
5
(c) Capital " Asset: sU~~\rtal 11 4b) Assets: Liabilities - Cap11a1
(a) Decrease
- l'lent · clo··-.
Paid Will lead res (d) Assets: Liabilities • Capitaf
l(e(Decrease:~ Aaprtal and liabilities
ass and
6 An .increase in one ssets . Capital
(a) Decrease· et is accompanied by: (b) Decrease in Asses and liabilities
(c) Increase .1incan~ther asset (d) None of the above
7 Decrease in o n .ap1ta1
(b) Increase in a Liability
(a) Increase ne1
hability may lead to:
WAny of the above
\le'( tither (a) n anoth er Liability
or (b)
( b) Decrease •nan
1 asset
(d) Neither (a ) nor (b)
 P1··H·t H.'a t q
. '-.: Ill''-( 11111
" tl l e
•
ounttngs t'<p1.1tH,11 nn lht• I
ll\
l,\ I l f ll
1 s1,0' l' 1 re ., [Link]<• slwd on th<' 1
· · i prt' '
' '
'•\flis of ln 1
c•,
'
llfll [Link] cmnnwncl·d busi1wss Wlth c .,~!, ,ff.Y.
~: purchased g<'ods 1\ 11 ,·ash l0,OO(

~- uought hn nit ll\'(' fot l ,\sh s,or.1.J

4. Bought goods on credit 15,SOO
:i paid rent 1,5fX
ti. Sold goods costing t 8,000 for cash ~ 1 ,000
[Ans, Cash ~ 24,500 + Stock~ 17,500 t Furniture~ 5/)00 - Creditor·
~ 15,500 r Cap•fa[ t 31,500

2_ prepare accounting eq~ation from the following transactions: ~)

1. [Link] started busmess with cash 50,000
2. Purchased furniture for cash 6,000
3. Bought goods from Ram on credit 15,000
4. Withdrew cash t 4,000 and goods for~ 5,000 for personal use.
s. Sold goods costing~ 8,000 at a profit of 25%.
6. Paid to creditors 10,00J
7. Received interest 2,000
[Ans. Cash~ 42,000 +Furniture~ 6,000 +Stock~ 2,0
<F Creditors t 5,000 + Capital~ 45,
~-V
'K3. !v1onu had the following transactions: ~
1. Started business with cash 1
2. Deposited cash into bank 6( LX ,
3. Bought a machine by raising a bank loan 5l! 000
4. Bought goods for cash r 20,000 and on credit 4l X
~ 'Goods bought for cash was sold to Amit
, &J Amit returned goods worth 5 )l};_
7. Amit settled his account by paying
8. Paid instalment of bank loan t 20,000 and paid inh.>rest
by cheque
9. Charge 10% depreciation on machine.
Use accounting equation to show effect of above tr.u1...-..1cth.'ll:--
, ' \
[Hint. Trans 6 - Amit returned goods t 5,000 It cost~~ 4 000 ~-,·' • ,: ·
is loss. Trans 7 - ~ 500 discount is a loss ~o reduct· ,·,1rzt,1l .. • •
l11t, rr~:f r,11.t :- ':-'
[Ans. Cash~ 39,500 +Bank~ 38,000 t Stoch {' ,14 000 t .\[Link]• ' ' '' c\\'
= Creditors~ 40,000 1 Ba11k Loon , JO 0(10 1 l ,: ·• t. ' •\· ','
,... •'\
reater Faridahad (Haq ana)
 I I ,,,,, I ~ ;\lt
II • ,.,,~11{ •c1 i 11 ~11,.,~
I I I tll1, , 1• I "' C' nil the follow1 n?. er""•<·- -......;:.::I
i IHH1 ,,,, 111 l ' I \ "1(), ()Q 0 ,.
~ J' ()(>oasadvanc<•
[> ' 0 •>(:- •

" 1 ( IJI',
11
II/ 11 J 111, 1 {,,, ,,,
1
I , 1 J J ,;. '/(J (}(}() ·
' I I I, , I ' ,, ,,t I lfl/J'lt()f
' J
1· <Ind on credit~ 20I
, 000 c::

' cr<,c I t for ~ 25 OOo

• I 1, 1 1 I 1, , ,1 1
I
'
• i
u,,111w, , W<Jfth 'Y , .
It ,, 1If , , , 10 00o i f .
II I 11 1/(,e, , or O nee uses and for r 5,<xx;
It, l 11/, f'lfJ(f
', Stock~ 30
JJ '
~Urniture ~ 10,000 + Prepaid Pent
~ 1 ooo'Ooo +d110
/11,,,t l\, •nt 1 ~000 . ' Cr, ~
rs 20,000 + Capital f 47,000.J ~
' is 'Xpense (loss),~ l ,Ooo Prepaid (Asset) & Cash w;n
preP
' ~;lh)\\' thl'l'ffr-ctofth c l1 . reduceby4,000.J !;.
e io owmg transa .
Ii) St,1rted busines . ctions on the accounting equation : 1.
~ 10,000 s W:ith cash t 20,000, gOOds ~ 30,000 and furniture
( ii) Bought 00d
g s on credit from Ram ~ 2S,OOO 2.
<iii) Bought gOOds for cash~ 10,000
3.
(iv) Returned good~ to Ram worth t 4,000 4.
(v) Sold goods costing ~ 20,000 for~ 26,000 in cash. 5.
6.
(vi) Settled the account of Ram at a discount of~ 1,000. 7.
(viz) Charge interest on capital ~ 3,000 8.
[Ans. Cash t 16,000 + Stock f 41,000 + Fumiture ? 10,000 ~ Capital
9.
10.
? 67,000] (.\m.
(i _ Show that accounting equation is satisfied in the following cases: Acer
J. Sumit commenced business with cash ~ 4D,OO0 and goods ~ 25,0{X)_ =C.
2. Sold 40% goods at a profit of 30:ii to Sohan.
3. Cood~ costing~ 1,000 was given as charity and goods worth ~ 2,{X)()
(i)
was taken away by Sumit for domestic use. (ii)
iii)
4. Salary is paid as advance t 3,000 to a worker~Ram whose wife is ill.
5. I nsurance Premium was paid (4,000 of which ¼th relates to next
(iu)
yea~ . (u)
6 , 5, 000 but it is still due ( 1,000.
Rent pa1.d ., p ·d E (t;z)
· k ~ 12 000 + Debtors r 13,000 + repa, :rpenses foii)
'Ans. Cash ? 28,000 + Sloe
i 4 000 = Outs/an . Expenses r 1' ooo + Capital t 56,00oJ
' d111g (tJiii)
i-
I •
(ix)
.
equatwn of Ram from the followmg transactions:
tin
7 Prepare accoun g . h t 50 000. (x)
. b . ess with cas , . (ti)
l. Commenced usm from Copi ;_md on credit from
Bought goods for cash ? 15,000 Ctii)
<:ttii
2. Amit for s' 25,000. Amit at a profit of 20%. (:ci-,
Sold goods bought from · - :£-----:--
odt'I n Ill

4·
•lh• pubhc scnoo1 -
5ettlcd the account of Amit by {)ayi
' ng,, 24,5{)()
Rent paid to hmdlord ~ !),000
5.
6. Sal,uy paid to Moh,m ~ 8,000 hut .sal . still l
, ary is
7. 1 ,mdlord rcquc~lctl for adv,mcc n'nt of · < uc' 1,00{)
him. ~ l,OOO and it w
· <l Paid tr
8. Insurance premium paid was~ 2 500 f .
' o wh1ch 1/ 5th
[Ans. Cash ~ 24,000 + Stock ~ 1S 000 Was prep 1
' + Pre 1'd au
== Outstanding Expenses ~ 1 ~~ expense~ 1 500
. ' 0 + Capital 3 '
E .
Prepare Accountmg quat10n of the following transactions and 1 9,5()0]
. a so the Balanc, S
1. Manu starte db usmess with cash.
Opened a Bank Account and transferred~ 4100 1,00 C)
Savings Account. ,OOO from his
2. Purchased a building from Sohan for '{ 12 00 000 .
taking a loan from SBI. ' ' paid by
3. Paid interest on loan r 20,000 and instalment of~ 1 00 10,00 000
4. Purchased goods from Rohan on credit. ' ,OOO.
5. Goods returned to Rohan costing 1,00,000
6. Sold goods costing t 40,000 fort 50,000 on credit to Ram 20,000
7. Took goods from business for personal use. ·
10,000
8. Accrued interest.
5,000
9. Commission received in advance.
20,00C
10. Cash received from Ram . 10,000
[Ans. Cash 130000 + Bank 80000 + Stock 30000 + Debtors -10000 +
Accrued Interest 5000 + Building 1200000
= Capital 485000 + Loan 900000 + Creditors 80000 + Comm1ssion Received in Advanced 2ooOOJ
. Show an Accounti!}g Equation on the basis of the following transactions: {
(i) Sunil started business with cash 1,50,000
(ii) Opened a Bank Account by depositing~ 25,000 out of cash
(iii) He sold his personal car for'{ 50,000 and deposited the amount
in the firm's Bank Account
(iv) He purchased a building and furniture for l,OO,OOO
50,000
(u) He purchased goods from Ram on creclit 500
(vi) He paid cartage 9.000
(vii) He sold to Shyam on credit goods coS ting ~ ,000 for
6 1,000
(viii) Received rent from tenants 1 500
(ix) Received security deposit from tenants !ln

(x) Purchased stationery for cash 50 200

OOLl

(xi) Invested in shares (personal) ~s,ooo

,xii) Received interest in cash soo
(xiii) Introduced fresh capital . l <J,78)00.]
500 t- Capito .
.
(xzv) Goods destroyed by fire _ Liabilities: f 5l,
[Assets: { 2,29,600 - ,1ccou11tn11c) (29)
 ~odt'rn lklhi PuhlJ~• St~l!o<~I ~ ,; )
111

Based on Total Assets, Opening Capital, Closing Capital at1d ~

y\ 10. X started business on h;t Apt 11, 2
oI9 with ct capit,,l of ~ J' 20,Ooo t()t~
• O(){) ·t Mire h 2020, 111s c1s.s£•ts Wert ? 1l~
took bank loan , 40, . 0 n ,31 s ' ' be f AO O(~
and creditors wc·n' ~ 30,000. Lo..in has .not •en pt1u1 :-io ar. l>tt<:r~· l
his capital at the end of the year anu,, pro fit earned ·
111~

[Ans. Capital~ ~,701000, profit:,, 50,f)(J(J

1
It. XStartedbusiness on 1st ApriJ 2019 with a capital off 1,20,00o Duriri J9
the year, he introduced furthe~ capital t 30iXXJ but withdrew ( 25,~
during the year for personal use. At the end of the year his assets 1

worth? 2,00,000 and liabilities amounting to ~ 30,000.

Determine his capital at the end of the year and profit or loss incurred
during the year ending 31st March, 2020.
[Ans. Capital ~ 1,70,000, profit ~ 45,000.J
12
· Find the opening capital of X from the following information:
!
0 tal assets ~ 1,40,000, outside liabilities
~ 30,000. Durmg the year, he
mtroduced ~ 30,00Q as further capita] and withdrew~ 20,000 for personal
use and earned a profit of~ 30,000 during the year.
[Ans. Capital (closing)~ 1,10,000; capital (opening)~ 70,00C
th
l J. If e capital of a business is~ 1, 10,000 and liabilities are of< 35 000 calculate the dmouni
Assets. ' ' o'1

. (A n . f 1,45 21.
14. Raman has following assets and liabilities: Cash< 18 ooo· Bank< 35 ooo· o bt r1 '
capital. •
10
<2~,000; Bank Loan< 11,000; Vehicle< 45,000 and Fu,rn1ture < 000' De tors . 4,000;Crea
• e ermine the amour'

15. Mollie started_business on 1st April, 2018 wilh a capital of< , . (Ans. f BB,
1 20 00
12,500 and withdrew< 7,000 tor his personal use He made ' _o. He introduced fresh capllci
3 ◄1 st Marc h , 2019. Calculate the capita! of Mukesh· as on s1aMprofit of< 15 ,OOO for the year en
31 arch, 2019.

16. Calculate the Missing Figures in the following cases: {Ans. f 1,40,
Case , Opening.. · Additional Drawings
Capital Capitf!I Profit and
Loss Closing 23.:
(i) 1,00,000 49,000 ? . Cap,~al
6,000
(ii) 50,000 10,000 4,000 1,50,000
(Iii) 90,000 I')., \I ? 7,000 ?
(iv) ? 3,250 32,500
7,ooo
00 -_ ~
(v) 85,000 32.000 tf,soo 16~
{Ans. (i) <s,ooo, (i,) <s 1,000, (iii) f [Link] (iv) • I (!I~ 1 ?
. ,2,20.000 ----•
[Link] started busines!; on P 1 April, 2018 with D cnp1!<1/ of ( fi0,ooo und a • (v)? 1,29,
introduced fresh capital of~ 15,000 and withdrew ( 8,000 tor Ills persorn/ loan of~
32
~ 4,500 tor the year ending 31 '" March, ?O 19 Ca/cu/nlC' lhP (\1p1ta1 c1ncJ T~t~;~- He made ,Ooo. He
on 31s March, 2019.
t ssers of S a_ loss of_
an,eevas
{Ans. (625
- - - - ~ : : - - : - : ~ - - - - - - -- : : - - : ;: : : - - -
-Grc:ucr . Oo·~
, Set.
Faridabad (llaryana)
 't,:,,.
'~
"#\. "' 1 h'l'fl )) .
l'lhi P11t11·It•~
&i I~ ' 1''- 0 111
·~ '\Jt>t>t ~t,1 le
So ' G~),Ooo ,1~ ~ H ~llts,nes.-
.,,.._._
60oo Pt,rL'h 1st:,.,
1 ' , 11
1 1
o ' 1) ta1....•-•net~"'
0 1, 1 ,
I\
V C'ICJ B,ink '~ Crodit h)1W1th11,f'w~'''· 011..1w
\ F'Pt '-'uk'l I \Vh,r: 1 i1:, nc ,11i n
) a~ on '1 ~, i ,1tc, tt1 i r10 I ' iu fl,, I l,1p,1 ii
"'- •1 f\1 l' fl l,1y ll<- Of
~0 (bJ5 lllf't1, ~ l) 1 :,nttt •lf1\1 1'''"'11 h,1(i' llli 'r Or, lie I I() 0
'-'\'VL'IO i':'. 3 u•·• 1
l
Q '
hl)
{ ') ( ) ..., <111\1 (' '11 1 IJ\,1,J, I rJ
Ss~. . cl r, ) ,;"l Comn {Ans .t,l) 0110 ::ip,1<11 • (Jf) ( 1 ) 1I
-~ ' ~O,ooo
b~,~~~ed bus,noss . l..oss ? 57,ooo , 11 JI re
hr::; closing , . Cd frorn c·111 0 11 1ti J· . Cap, 1"' •
( b) If •n the abovcap1ta1 bank c\nuary c1 °113 1 ,
and Profits -On31s1 D • 201a v,,111 a M
, 10 000 fo e case, the pr _earned [Link], 2010 ~ap,1a1 rJf'
r Personal p opnetor h g tho Year is assets,,.
Urpose act introd '"r ~
{Ans. (a) Clo . . calcuiate ht uced fresh ca
Do.] 20. Calc ulate the M . sing Capita/ - 'Y s Profits. P lal ot ~ 40 ooo
-:~-.,--:.....::~~1ss1ng
Cas e O
Fi
. -,-__ 9Llres in the
- ~ 7 60 00
' ' O, Prof,r ?
ct
'P enmg Add·1· following - 1,60,000 (b)
-(~-r---=--=;:.::a~-+~C
(i)
Capit I
?
t 1ona1
~a~· ~J
pita/
D .
rawmg s
cases:
Profit and
, Prof

-fi(ii)i)-1 -~~~::-+--~s~o~.o~o~o Loss Tora, lL -;--

, oo =j~~
~~=~~~5~5~,o~o~o~=~~?~00~~1~ij
.} =(iii)
1,25,ooo
(1v)
(v)
14,ooo -7,ooo __ [Link]
2,so,ooo
1,00 ,0 00 ;5
?
5O
?
33,500 10,000
9,0oo
---
1,41,000
?
_
2-:_o~~o~- 48 ~
~ss-ers
75,ooo--.-- -
-~:;
- _
-l __
39
0 3,~T 1 21
_. oo ? 13,soo -- -
{ Ans. (i) r 1, 00, ooo, r- 1, 52, ooo; (11) r 15 o~~2~,~oo ? \-- 30 3-
(iv) f 3 500 ~2 l,OOO; (u,) <B,000, <1 80 C
21. Calculate Total Equity if: · · •29 ,ooo, (v)< B,ooo, z 7.50 a:
(i) Owner's Equ ity in 1he beginning ~ 2 80 ooo
(ii) Creditors at the end f 45,000 ' ' ·
(iii) Revenue during the peri od is~ 5,80,000.
(iv) Expenses during the same period are~ 4,00,000.
a {Ans. r 5,05 2-.-.
st
22. Determine the capital of Pranav as on 31 March, 2019, it his position as on that date was as 10 0 .s
He owns Machinery of~ 40,000; Building of~ 1,20,000;FurnitureoH 15,000andCash riuand\\~s
r 6,000. He owes~ 45,000 to creditors and has a bank loan oH 18,000tal<.enlrorYt SB Ban"'
{Ans.< 11~ (\2'

·
st January, 201 8 wit ~
h cap,·t aI "'' 2 ,20 ,000 On 3P1 Oecernber ' 20 1 ~h
23. Smriti started a business on 1
. b'l't' t " 1 17 000 Find ou\ the amount by \\I-\,
her total assets amounted to< 4,30,000 and Ila 11 1es o' , 1 , -

her capital has increased as on 31 51 December, 2018. {Ans. , 93,0JOj