Question
On Jan 1, 2017 the position of V. Mathur was as
follows:  Inventory in hand Rs. 2400; Bills payable Rs. 400; Cash at Bank Rs. 1800; Plant and machinery Rs. 1000; Debtors Rs. 500; Creditors Rs. 800; Investments 2000; Loan from Raja Ram Rs. 1500. V. Mathur’s capital on the above date will beSolution
Closing Capital =Closing Assets – Closing Liabilities Here Closing Assets = Inventory + Cash at Bank + Plant and Machinery + Debtors + Investments = 2,400 + 1,800 + 1,000 + 500 + 2,000 = 7,700 Closing Liabilities = Bills Payable + Creditors + Loan from Raja Ram = 400 + 800 + 1,500 = 2,700 So Closing Capital = Closing Assets – Closing Liabilities = 7,700 – 2,700 = Rs. 5,000
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