Question

What will be the effect of the following on the Accounting Equation :-
1. Purchased goods for Rs.20,000 from Mahesh on Credit.
2. Sold goods to Suresh costing Rs.8,000 for Rs. 10,000 in cash.
3. Paid Wages Rs.500.
4. Withdrew in cash for private use Rs. 2,000.
5 Paid to creditors Rs. 5,000.

Answer 1

1. + Stock + Creditors
2. + Cash - Stock + Capital
3. - Cash - Capital
4. - Cash - Capital
5. - Cash - Creditors]