Business & Accounting Studies
Grade 10
Accounting Equation
(1) Nadini started a tailoring business on the 1st of January 2023. The following transactions
are given to you for the January month of the business.
1. Invested Rs.200 000 as the capital
2. Purchased machinery at Rs.80 000
3. Obtained a bank loan of Rs.50 000
4. Earned cash income of Rs.10 000 from sewing clothes
5. Paid Rs.10 000 as the monthly rent payments
6. Paid Rs.2 000 of the electricity bill
7. Deposited Rs.25 000 in a fixed deposit account
8. Nadini invested an additional capital of Rs.15 000
9. Settled Rs.10 000 of the bank loan
10. Borrow a cash of Rs.20 000 from Shanika
Show the impact of each transaction with the amount in the following equation.
Machinery + Fixed deposit+ Cash = Equity + Bank Loan+ Creditors
(2) Sandun started a business of selling stationery on the 1st of January 2023. The following
transactions are given to you for the January month of the business.
1. Invested Rs.600 000 as the capital
2. Obtained a bank loan of Rs.200 000
3. Deposited Rs.100 000 in a bank current account
4. Purchased goods at Rs.100 000
5. Purchased furniture at Rs.30 000 for the use of business
6. Sold goods which cost Rs.50 000 at Rs.60 000
7. Paid Rs.25 000 as the monthly salary
8. Sandun Withdraw cash at Rs.5 000 for his private use
9. Invested an additional capital of Rs.10 000
10. Paid Rs.5 000 of the electricity bill
Show the impact of each transaction with the amount in the following equation.
Furniture + Stock + Bank balance + Cash = Equity + Bank Loan
(3) The following balances were shown as at 01.07.2023 of Sanjana’s business.
Assets
Machinery 100 000
Stock 150 000
Cash 80 000
Debtors 125 000
1
Liabilities
Bank Loan 200 000
Creditors 10 000
The following transactions occurred in July 2023.
1. Invested an additional capital of Rs.40 000
2. Purchased goods at Rs.100 000
3. Paid Rs.25 000 as the salary
4. Sanjana Withdraw stock at Rs.5 000 for his private use
5. Sold goods which cost Rs.10 000 at Rs.15 000
6. Purchased machinery at Rs.10 000
7. Settled bank loan of Rs.20 000
8. Paid Rs.5 000 to creditors
9. Received Rs.50 000 from debtors
10. Paid Rs.15 000 of the rent payments
i. Calculate the Equity of the owner as at 1st of July 2023.
ii. Show the impact of each transaction with the amount in the following equation.
Machinery + Stock + Debtors + Cash = Equity + Creditors + Bank Loan
(4) The following balances were shown as at 01.05.2023 of Sama’s business.
Equity 300 000
Bank Loan 200 000
Cash 150 000
Debtors 120 000
Furniture 180 000
Stock 50 000
The following transactions occurred in May 2023.
1. Owner invested Rs.500 000 of Motor Vehicle as capital
2. Settled bank loan of Rs.20 000 including Rs.2 000 of interest
3. Purchased goods at Rs.50 000 on a credit basis
4. Sold goods which cost Rs.10 000 at Rs.30 000
5. Received Interest income of Rs.3 000
6. Paid Rs.2 000 from the business for electricity bill of the owner’s house
7. Purchased stock at Rs.25 000 on a cash basis
8. Paid Rs.30 000 to creditors
9. Paid Rs.2 500 as the electricity bill
10. Received Rs.5 500 of sales commission
Show the impact of each transaction with the amount in the following equation.
2
Furniture + Motor Vehicle + Stock + Debtors + Cash = Equity + Creditors + Bank
Loan
(5) The following transactions are given to you for the April month of Rayan’s business. Show
the impact of each transaction with the amount in the accounting equation.
01.04.2023 - Invested Rs.200 000 as the capital
02.04.2023 - Purchased goods at Rs.50 000
03.04.2023 - Purchased goods at Rs.25 000 on a credit basis
04.04.2023 - Obtained a bank loan of Rs.100 000
05.04.2023 - Sold goods which cost Rs.50 000 at Rs.75 000
08.04.2023 - Purchased a computer at Rs.50 000 for the use of business
09.04.2023 - Sold goods which cost Rs.20 000 at Rs.25 000 on a credit basis
12.04.2023 - Paid Advertising Expenses Rs.2 000
15.04.2023 - Paid Rs.1 000 of the electricity bill
21.04.2023 - Paid Rs.5 000 of salary
22.04.2023 - Received Rs.2 500 of Commission Income
23.04.2023 - Settled Rs.20 000 of bank loan
25.04.2023 - Cash drawings Rs.5 000
28.04.2023 - Purchased furniture and equipment at Rs.12 000
30.04.2023 - The owner invested Rs.150 000 in Motor bicycle as capital
(06) The following table shows the impacts of transactions on the accounting equation of a
business. Write possible transactions with the amount that may have taken place during each
day.
Date Assets Equity Liabilities
st
01 of June Increase Increase
05th of June Increase
Decrease
07th of June Decrease Decrease
11th of June Increase Increase
18th of June Increase Increase
(07) The following accounting equation of Nihal’s business shows the impacts of transactions
that occurred in May 2023. Describe each transaction with the related amounts.
Date Assets =Equity + Liabilities
Furniture Stock Debtors Cash Equity Creditors Bank loan
May 1 +500 000 +500 000
May 5 +50 000 -50 000
3
May 7 +25 000 -25 000
May 10 -20 000 +25 000 +5 000
May 12 -18 000 +18 000
May 18 +100 000 +100 000
May 20 +20 000 +20 000
May 21 -5 000 -5 000
May 22 +12 000 +12 000
May 28 -2 000 -2 000
(8) The following transactions are given to you for the April 2017 of Rashmi’s business.
01.04.2023 - The owner invested Rs.800 000 of cash as capital
03.04.2023 – Obtained a bank loan of Rs.200 000
07.04.2023 – Purchased furniture of Rs.50 000
08.04.2023 - Purchased stock at Rs.50 000 on a cash basis
10.04.2023 - Sold goods which cost Rs.20 000 at Rs.24 000 on a credit basis
15.04.2023 - Paid Rs.10 00 as the insurance payments
18.04.2023 – Settled bank loan of Rs.20 000
20.04.2023 - Received Rs.2 000 of sales commission
21.04.2023 – Borrowed cash of Rs.80 000 from Amal
30.04.2023 – withdraw cash at Rs.5 000 from the business for her son’s medical channeling
fees
Show the impact of each transaction with the amount in the accounting equation.
Assets = Equity + Liabilities
(9) The following balance was shown as at 01.11.2023 of Ayesha’s business.
Equity 300 000
Bank Loan 100 000
Cash 150 000
Creditors 20 000
Computer 85 000
Stock 185 000
The following transactions occurred in November 2023. Show the impact of each transaction
with the amount in the accounting equation.
Assets = Equity + Liabilities
1. Invested an additional capital of Rs.25 000
4
2. Settled bank loan of Rs.10 000 including Rs.1 000 of interest
3. Paid Rs.10 000 to creditors
4. Sold goods which cost Rs.10 000 at Rs.15 000
5. Paid Rs.20 000 as the salary
(10) Gimhani started a shoe-selling business on the 1st of January 2023. The following
transactions are given to you for the January month of the business.
1. Invested Rs.500 000 as the capital
2. Purchased machinery at Rs.250 000
3. Obtained a bank loan of Rs.100 000
4. Purchased Rs.150 000 of stock on a cash basis
5. Sold stock of Rs.30 000 which cost Rs.25 000
6. Paid Rs.15 000 as the monthly rent payments
7. Withdraw Rs.2 500 of stock for the owner's private use
8. Sold stock of Rs.12 000 which cost Rs.10 000
9. Paid Rs.25 000 of the salary
10. Invested Rs.5 000 as an additional capital
Show the impact of each transaction with the amount in the accounting equation.
