Question

The table below sets out account balances from the books of a business. The columns (a) to (1) show the account balances resulting from a series of transactions that have taken place over time. You are to compare each set of adjacent columns, ie (a) with (b), (b) with (c), and so on and state, with figures, what accounting transactions have taken place in each case. (Ignore VAT). (e) (d) (a) (1) (b) £ £ £ £ £ Assets Office equipment 2,000 2,000 2,000 2,000 Van 10,000 2,000 10,000 3,000 10,000 Bank 10,000 8,000 14,000 4,000 6,000 Liabilities Loan 6,000 6.000 6,000 3,000 Capital 10,000 10,000 10,000 10,000 12,000 12,000

Answer 1

1. Purchased office equipment at a cost of $2000

Purchased office van ata cost of $10000.

Initially deposited $10,000 in the bank account, then withdrew $2000, the again deposited $6000, withdrew $4000, deposited $2000 and withdrew $1000.

Took a loan of $6000 and repaid $3000

Initially invested capital of $10000 into the business by the owner and then invested $2000 more.

2.

Assets - Liabilities = Capital

8000 - 0 = 8000

8000-4000+4000   - 0   = 8000

8000+3000 - 3000 = 8000

11000 -6000 +6000 -3000 = 8000

  

Assets Liabilities Capital

a. 20000

b 10000

c 7550

d 14100

e 18430

f 21160