The whole of financial accounting is based upon the very simple idea that, resources supplied by the owner of the business plus liabilities that must be settled at a future date must be equal to the resources in the business. It follows that the capital plus liabilities of the entity must be equal to assets of the entity expressed as: Capital + Liabilities = Assets (i.e. C+L=A). Using Microsoft excel, demonstrate the effects of the following transactions on the accounting equation, and prepare the resultant balance sheet as at 31st July, 2020, 1 July started business with cash $30,000 2 Sales on cash $50,000 4 Stock of materials paid by cash $10,000 5 Paid cash into bank $20,000 7 Withdrew cash for office use $10,000 8 Loan received by cash $20,000 10 Sales of goods received cheque $30,000 19 Cash sales $80,000 21 Debtor paid us by cash $50,000 30 Sales, received cheque $40,000
The whole of financial accounting is based upon the very simple idea that, resources supplied by the owner of the business plus liabilities that must be settled at a future date must be equal to the resources in the business. It follows that the capital plus liabilities of the entity must be equal to assets of the entity expressed as: Capital + Liabilities = Assets (i.e. C+L=A).
Using Microsoft excel, demonstrate the effects of the following transactions on the
1 July started business with cash $30,000
2 Sales on cash $50,000
4 Stock of materials paid by cash $10,000
5 Paid cash into bank $20,000
7 Withdrew cash for office use $10,000
8 Loan received by cash $20,000
10 Sales of goods received cheque $30,000
19 Cash sales $80,000
21 Debtor paid us by cash $50,000
30 Sales, received cheque $40,000
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