Skip to main content

11 Class Accountancy Rules for Accounting Equations


11 Class Accountancy Rules for Accounting Equations

An Accounting Equation represents the relationship between assets and liabilities of the firm, showing total assets of the firm is equal to the total liabilities and owner’s capital/equity.An Accounting equation is based on the dual aspect concept of accounting. Every transaction has two aspects-debt and credit and affects either both the sides of the equation or one side of the equation only with equal amounts.
Transactions from the accounting equation viewpoint can be divided into two, i.e.,
  • Transactions affecting two items

  1. Increase in the asset, increase in the liability
  2. Decrease in the liability, decrease in the asset.
  3. Increase in the asset, increase in the owner’s equity
  4. Decrease in the owner’s capital, decrease in the asset.

 Transactions affecting the same side but in opposite direction are:
  1. Increase in asset, decrease in another asset
  2. Decrease in liability, increase in another liability

  • Transactions affecting more than two items.
Some transactions affect more than two items of the accounting equation or a balance sheet.
The procedure to work out an accounting equation is:
  1. Analyze the transaction in terms of such variables as assets, liabilities, capital, revenues, and expenses.
  2. Decide the effect of the transactionin terms of increase or decrease on variables as assets, liabilities, capital, revenues, and expenses.
  3. Record the effect on the relevant side of the equation.

Read more---->> 11 Class Accountancy Rules for Accounting Equations

Register with Takshila Learning for Accountancy Classes, sample papers of Class 11, CBSE online classes from Nursery to 12th, and much more.
For course demos & fee related queries, Leave your details and our counselor will get back to you or Call us at 8800-999-280/8800-999-284.

Comments

Popular posts from this blog

Magnetic and non-magnetic material Class 6 Science

Magnetic and non-magnetic material  Class 6 Science A magnet is a substance that is drawn to certain magnetic materials like iron, cobalt, and nickel. Magnets have the ability to draw iron to them. Natural magnets are rocks that naturally draw iron. Non-magnetic materials include things like wood, rubber, coins, feathers, leather, etc. that are not drawn to iron. Magnet characteristics It pulls magnetic materials, such as iron. The magnet's two ends are referred to as its poles. The magnet's diametrically opposed poles are drawn together. Heating, hammering, or dropping causes it to lose its characteristics. On the basis of properties types of Magnets Temporary magnets are those magnets that are magnetic for only a little duration. Typically, iron, cobalt, or nickel are used to make them. When they are close to the powerful magnet, they act like a magnet. When they are yanked away from the powerful magnet, they stop being magnetic. Permanent magnets are magnets that have magne...

Best Sample papers for Bank PO Exam Download

Sample papers for Bank PO Exam | Question Paper for Bank PO : Institute of banking Personnel Selection (IBPS) Department issued a Notification of IBPS PO 2017  exam announced in October month. IBPS Probationary Officer (PO) Online Application Form process will be begin from July 2017. This is a hard exam for all students so aware of its value. Large number of  candidates will participate in this exam. So all candidates should prepare well for it. Check out IBPS, Bank PO Sample papers, Question Paper Pattern, SBI  PO Syllabus ,   IBPS Syllabus  and other IBPS PO Preparation 2017 This paper is identical to any Bank PO Question Paper Pattern. Check whole IBPS Bank “PO question paper” subject wise. IBPS (PO) Paper Pattern Analysis with Syllabus and main topics of IBPS Exam 2017. PO Question Paper Pattern, Bank PO sample Papers for IBPS Bank Exam IBPS PO Exam will be conducted at three levels 1st- PO Preliminary Exam 2nd- PO Mains Exam 3rd- PO Common ...

Online/Offline CBSE Coaching Classes for class 9

CBSE Coaching Class 9 :-   In a move to make the digital India and Skill India dream into a reality, we are providing the best courses to our students in e-learning mode. Our program consists of entire 9th class syllabus in a fun learning method with various ways like sounds and animations. Our content is in 2-D & 3-D animation for better understanding of students. So That students will be understand every thing clearly and it makes the learning easy and entertaining. We are offering the following subjects for class 9th Standard:   Maths Class Physics Class Chemistry Class Biology Class Our E-learning provides the best and trained teachers with highly qualified for the respective subjects, they help to improve the students’ performance and to teach the every concept clear and easy in better way. Our main motive is to help students to learn well and gain more marks with making  their basic concept strong and good knowledge base ...