Analyse the effects of business transactions

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Question: An accounting equation is referred to an equation in which total assets is always equal to capital plus liabilities.

Sometimes, business transactions which affect either both sides of the equation or one side of the equation, but the ultimate effect must be equal on the both sides.

On this topic, you are required to record the following transactions, identify the accounts involved and analyse the effects of business transactions using the accounting equation.

i. Business commenced with cash

ii. An asset purchased for cash

iii. Goods purchased on credit

iv. Expenses paid by cash

v. Goods sold on credit

Reference no: EM132977835

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