Account 1 Marks Question

If the Capital of a business is ₹ 5,00,000 and Outside liabilities are ₹ 2,00,000, calculate total assets of the business.

Give fundamental accounting equation.

If total assets of a business are ₹ 10,00,000 and capital is ₹ 4,00,000, calculate creditors.

If the Capital of a business is ₹ 1,20,000 and Outside liabilities are ₹ 20,000, calculate total assets of the business.

What is Credit?

‘X’ commenced business on 1st April, 2013 with a capital of ₹ 6,00,000. On 31st March, 2014 his assets were worth ₹ 8,00,000 and liabilities ₹ 50,000. Find out his closing capital and profits earned during the year.

Name the side on which increase in capital is recorded.

What is Debit?

Why are the rules of debit and credit same for both liability and capital?

Prove that, “Accounting Equation holds good under all circumstances." Give atleast two illustrations.

Which transactions will:

1. Decrease the Assets and Decrease the Capital.
2. Increase the Assets and Increase the Liabilities.
3. Increase the Assets and Decrease another Asset.
4. Decrease the Assets and Decrease the Liabilities.

What is an accounting equation?

Which of the following equations are correct?

1. Assets = Capital + Liabilities
2. Assets = Capital - Liabilities
3. Assets = Liabilities - Capital
4. Capital = Assets - Liabilities
5. Capital = Assets + Liabilities
6. Liabilities = Capital + Assets
7. Liabilities = Capital - Assets
8. Liabilities = Assets - Capital

What entry (debit or credit) would you make to:

1. Increase in revenue.
2. Decrease in expense.
3. Record drawings.
4. Record the fresh capital introduced by the owner.

The position of a businessman on 30th June 1994 was as follows :
Cash ₹ 5,000; Debtors ₹ 20,000; Machinery ₹ 60,000; Stock ₹ 25,000; Capital ₹ 75,000. Calculate his liabilities.

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

Give two basic purposes of accounting equation.

If a transaction has the effect of decreasing an asset, is the decrease recorded as a debit or as a credit? If the transaction has the effect of decreasing a liability, is the decrease recorded as a debit or as a credit?

If total assets of a business are ₹ 1,30,000 and capital is ₹ 80,000, calculate creditors.