Give an example of a transaction where an asset and owner's capital will increase.

1. Purchases Account.
2. Cash.
3. Capital.
4. Salary.
5. Interest received.
6. Sales Return.
7. Machinery.
8. Drawings.

How an Accounting Voucher is prepared?

''Accounting Equation (A = L + C) always holds good under all circumstances''. Explain with the help of two examples.

Is Capital Account a Personal or Real Account and why?

What will be the effect of the following on the Accounting Equation.

1. Purchased goods for ₹ 20,000 from Mahesh on Credit.
2. Sold goods to Suresh costing ₹ 8,000 for ₹ 10,000 in cash.
3. Paid Wages ₹ 500.
4. Withdrew in cash for private use ₹ 2,000.
5. Paid to creditors ₹ 5,000

Goods costing ₹ 10,000 have been sold for cash at 25% profit. How will the transaction be shown in the Accounting Equation?

Why transactions are recorded on the basis of source documents?

What does a Credit Balance in a Capital Account signify?

Enumerate four advantages of Ledger.