Leaning Online

Here is the illustration or Example of Accounting Equation from the book of principles of accounting i.com part 1 or b.com part, chapter 2 for understanding the accounting equation through an illustration 2. Solve the following transactions in accounting equation 2014 June 1 .   Mr. Salman started his business with cash Rs.10,00,000            5 .   Purchased Furniture for cash Rs.4,000            6.   Purchased Goods for Cash Rs.25,000            10.   Paid Transportation on goods purchased Rs.1,000             12.   Sold Goods For cash Rs.15,000, costing Rs.11,000            15.   Purchased Goods on credit basis for Rs.15,000           ...

Without knowing that how to make transaction analysis, no one can record the transaction in the Journal , so it is the basic of recording a transaction.  Here, we discuss some of the most important transactions of the business that take place in every business’s life which have effects on the Accounting Equation   (Assets = Lia bilities + Equity). If you do not know about Transaction then, Please Read this Article about    What is a Transaction Before maki ng transaction analysis and its effects on the accounting equation, we must take into account following three important points to know: 1. Assets affect the asset side of Accounting Equation. 2. Liabilities & Capital or Equity affects the Liabilities & Equity side. 3. Revenues & Expenses also affect the Liabilities & Equity side of accounting equation as these are the results of profitable activities of the owners of the business so revenues are added to...