Answer to Question #289767 in Financial Math for Anike

Question

Accounting equation

Debit/credit

Effects on accounting equation

Assets

Owners equity

Liability

1. Owners contributed cash R50 000 and personal computer R9000 to the business as capital.

2. Business sold goods on credit to a customer Total sales value R15 000

3. The business had not paid rent yet at month end R10 000

4. The owner borrowed a loan from bank R25 000

Answer 1

1. Owners contributed cash R50 000 and personal computer R9000 to the business as capital.

it will be a credit and will increase the assets by RS59,000 in the accounting equation

2. Business sold goods on credit to a customer Total sales value R15 000

It will be a debit and an increase in assets by RS15,000 in the accounting equation

3. The business had not paid rent yet at month end R10 000

This will be a debit and a liability of RS 10,000in the accounting equation

4. The owner borrowed a loan from bank R25 000

This will be a credit and the assets will increase by RS25,OOO and owners equity will increase BY RS25,000 too in the accounting equation