Financial accounting bcom semester 1
This query is : Resolved
Heena Bhagria
(Querist)
22 September 2020
Accounting equation treatment for the entry
Extra furniture worth₹2000 sold to purana for ₹2500 and entire amount was taken for personal expenses of owner
Extra furniture worth₹2000 sold to purana for ₹2500 and entire amount was taken for personal expenses of owner
CA Kushwanth AVSR
(Expert)
26 September 2020
In this question, you can pass two entries:
1. For Sale of Furniture:
Cash/ Bank A/c Dr. 2500
To Furniture A/c 2000
To Profit and Loss A/c 500
(Being Furniture sold for profit of Rs. 500/- ( In the absence of depreciation, I had assumed there is no depreciation))
2. Amount withdrawn by owner for his personal expenses - This will be treated as drawings
Capital A/c (Drawings A/c) Dr 2500
To Cash/Bank A/c 2500
(Being Amount withdrawn by Owner for his personal expenses)
1. For Sale of Furniture:
Cash/ Bank A/c Dr. 2500
To Furniture A/c 2000
To Profit and Loss A/c 500
(Being Furniture sold for profit of Rs. 500/- ( In the absence of depreciation, I had assumed there is no depreciation))
2. Amount withdrawn by owner for his personal expenses - This will be treated as drawings
Capital A/c (Drawings A/c) Dr 2500
To Cash/Bank A/c 2500
(Being Amount withdrawn by Owner for his personal expenses)
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