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while calculating cost of goods sold carriage inward added to purchase .. Whu like so?
Thanks Great Tutor!
Petty cash is ‘loose’ cash.
Imagine you own a shop. Most of your receipts will be in petty cash.
However it is likely that at the end of the day you will put most of this ‘loose’ cash into the bank.This is banking of petty cash.
(and the entry is DR cash at bank; CR Petty cash.)
I cant understand income statement account
why purchase account on the debit side and sales revenue on the credit side of income statement account? can you write double entries?
When you receive income, the entry is DR Cash and Cr the income account.
At the end of the year, the total is transferred to the Income Statement T’A/c:
Dr Income Account, Cr Income Statement A/c.The balance on the income account is now zero and the same account can be used to record next years income.
Dear sir, please explain 🙂
1 may Purchase of goods for resale on credit 300
2 may Max injects long term capital into business 1400
3 may Payment of rent made 750
5 may Max withdarws cash from busines 400
7 may Sale made on credit 1200Goods originally cost 600
At the start of the week the assets of business were 15700 and liabilities amounted to 11200At the end of the week what is amount of capital?
At the start of the week, the capital = net assets = 15700 – 11200 = 4500.
During the week, the capital will change because of capital introduced, profit, and drawings.
So…..there was capital introduced of 1400. There were drawings of 400. There was a profit on sale of 1200 – 600 = 600.
So capital at the end of the week is 4500 + 1400 + 600 – 400 = 6100
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