A sole trader took some goods costing $800 from inventory for his own use. The normal selling price of the goods is $1,600. Which of the following journal entries would correctly record this? Dr Cr $ $ A Inventory account 800 Purchases account 800 B Drawings account 800 Purchases account 800 C Sales account 1,600 Drawings account 1,600 D Drawings account 800 Sales account 800

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Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is