The accounting equation is a mathematical equation which shows that the assets and liabilities of a firm are equal, i.e., Assets = Liabilities + Capital. It is based on Dual Aspect Concept of Accounting.
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A starts a business and invests $₹ 50,000$ on $1^{st}$ April, $2018$. On $31^{st}$ March, $2019$ his assets are $₹ 65,000$ and liabilities are $₹ 6,000$. Find out the amount of capital on $31^{st}$ March, $2019$ and his profit.
On $31^{\text {st }}$ March, $2019,$ the total assets and external liabilities were $₹ 2,00,000$ and $₹ 6,000$ respectively.
During the year, the proprietor had introduced capital of $₹ 20,000$ and withdrawn $₹ 12,000$ for personal use. He made a profit of $₹ 20,000$ during the year. Calculate the capital as on $1^{\text {st }}$ April, $2018.$