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Question
‘Cash withdrawn by the proprietor from the business for his personal use’ causes ____________.
Options
Decrease in assets and decrease in owner’s capital
Increase in one asset and decrease in another asset
Increase in one asset and increase in liabilities
Increase in asset and decrease in capital
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Solution
‘Cash withdrawn by the proprietor from the business for his personal use’ causes Decrease in assets and decrease in owner’s capital.
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RELATED QUESTIONS
Accounting equation signifies ___________.
Which one of the following is representative personal account?
What is the accounting equation?
Write any one transaction which decreases the assets and decreases the liabilities
Write any one transaction which increases one asset and decreases another asset
What is an Account?
Classify the accounts with suitable examples.
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For the following transactions, show the effect on the accounting equation.
- Raj started business with cash - ₹ 40,000
- Opened bank account with a deposit of - ₹ 30,000
- Bought goods from Hari on credit for - ₹ 12,000
- Raj withdrew cash for personal use - ₹ 1,000
- Bought furniture by using debit card for - ₹ 10,000
- Sold goods to Murugan and cash received - ₹ 6,000
- Money withdrawn from bank for office use - ₹ 1,000
Prepare accounting equation for the following transactions.
- Murugan commenced business with cash ₹ 80,000
- Purchased goods for cash ₹ 30,000
- Paid salaries by cash ₹ 5,000
- Bought goods from Kumar for ₹ 5,000 and deposited the money in CDM.
- Introduced additional capital of ₹ 10,000
