Recording of Transactions-I

(assets) by Rs. , , , decreases cash by Rs. , and increases liabilities (M/s Ramjee lal as creditor) by Rs. , , .

. Goods purchased from M/s Sumit Traders for Rs. , . Analysis of transaction: This transaction increases goods (assets) and increases liabilities (M/s Sumit Traders as creditors) by Rs.

, . . Goods costing Rs. , sold to Rajani Enterprises for Rs.

, . Analysis of transaction: This transaction decreases stock of goods (assets) by Rs. , and increases assets ( Rajani Enterprises as debtors Rs. , ) and capital (with the profit of Rs.

, ) The final equation as per the above analysis table can be summarised in the form of a balance sheet as under: Balance Sheet as at..... Liabilities Outsider’s Claims (Creditors) , , , , Bank , , Debtors , Stock Furniture , Plant & Machinery , , , , , , In terms of accounting equation A = L + C Rs. , , = Rs. , , + Rs.

, , As already stated every transaction involves give and take aspect. In double entry accounting, every transaction affects and is recorded in at least two accounts . When recording each transaction, the total amount debited must