Question

XYZ Ltd, wants to start a new clothing business. He has a total sum of Rs. 100,000 in his savings that can be invested. In addition, he owns a small shop at a primary location that can be used to start a retail clothing outlet. He purchased furniture, including shelves, a counter desk, and other equipment for the store for Rs.15,000. He also hires a staff of two for customer support and other office work for Rs.5, 000 each XYZ Ltd., decided to start with men's clothing and purchased a complete range of

clothes from the wholesale market, which cost him around Rs.75,000. The initial purchase got sold in not more than one month for Rs.95000 XYZ Ltd., wants to journalize these transactions and create ledger accounts for April 2021

Answer 1

[AI-generated answer — Bot GPT 3.5]

Apr 1:

Cash Rs.100,000
Capital Rs.100,000

Apr 1:
Furniture and Equipment Rs.15,000
Cash Rs.15,000

Apr 1:
Prepaid Wages Rs.10,000
Cash Rs.10,000

Apr 1:
Inventory Rs.75,000
Cash Rs.75,000

Apr 30:
Cash Rs.95,000
Sales Rs.95,000

Apr 30:
Cost of Goods Sold Rs.75,000
Inventory Rs.75,000

Ledger Accounts:
1. Capital:
April 1 - By Cash Rs.100,000

2. Furniture and Equipment:
April 1 - By Cash Rs.15,000

3. Prepaid Wages:
April 1 - By Cash Rs.10,000

4. Inventory:
April 1 - By Cash Rs.75,000
April 30 - By Cost of Goods Sold Rs.75,000

5. Sales:
April 30 - By Cash Rs.95,000

6. Cost of Goods Sold:
April 30 - To Inventory Rs.75,000