Question

The following transactions took place in Boeing Business.

01.03.2021 - Purchase of goods costing Rs. 150000 from Airbus
company on credit.
05.03.2021 - Return of goods costing Rs. 30000 to Airbus
20.03.2021 - Sale of goods costing Rs. 100000 for Rs. 160000 on
credit
29.03.2021 - Payment of sales commission of Rs. 10000
02.04.2021 – Settlement of the full amount due to Airbus
What is the accounting equation which shows the net impact of the
above transactions in Boeing business as at 31.03.2021?
Assets
Liabilities
+
Equity

Answer 1

1) Dr: Goods/Inventory (Asset increase) 150000

Cr: Payable (Liability increase) 150000

2) Dr: Payable (Liability decrease) 30000

Cr: Goods (Asset decrease) 30000

3) Dr: Payable (Liability decrease) 30000

Cr: Goods (Asset decrease) 30000

4) Dr: Receivables (Asset increase) 160000

Cr: Goods (Asset Decrease) 100000

Cr: Profit and loss (Equity increase) 60000

5) Dr: Commission Expense (Equity decrease) 10000

Cr: Cash (Asset Decrease) 10000

6) Dr: Payable (Liability decrease) 120000

Cr: Cash (Asset Decrease) 120000