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Question
What is an Account?
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Solution
Every transaction has two aspects and each aspect affects a minimum of one account.
An account is the basic unit of identification in accounting.
A ledger account is a summary of relevant transactions at one place relating to a particular head.
The account is the systematic presentation of all material information regarding a particular person or item in one place, under one head.
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RELATED QUESTIONS
‘Cash withdrawn by the proprietor from the business for his personal use’ causes ____________.
The incorrect accounting equation is _____________.
Which one of the following is representative personal account?
Write any one transaction which increases one asset and decreases another asset
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Prepare accounting equation for the following transactions.
- Murugan commenced business with cash ₹ 80,000
- Purchased goods for cash ₹ 30,000
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- Introduced additional capital of ₹ 10,000
What will be the effect of the following on the accounting equation?
- Sunil started business with ₹ 1,40,000 cash and goods worth ₹ 60,000
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Create an accounting equation on the basis of the following transactions:
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