CBSE
Accounting Equation: Class 11 Practice in TS Grewal Chapter 5 Style
Accounting Equation is Chapter 5 in the 2025-26 TS Grewal Class 11 book. Every transaction must keep Assets = Liabilities + Capital in balance. Below are original equation questions worked transaction by transaction the way CBSE expects, with a running check after each step. They match the book's chapter and difficulty without copying its questions.
Accounting equation questions are where Class 11 marks are either banked or bled. The method is completely mechanical once you see it: write the equation, push each transaction through it, and prove both sides agree after every line. I cannot copy TS Grewal's own Chapter 5 questions here because the book is copyrighted, so I wrote fresh ones covering the same transaction types the 2025-26 chapter drills: cash and credit purchases, sales at a profit, drawings, expenses, outstanding items and capital brought in kind. Every running total below has been checked twice. Do each question on paper first, then read the working.
How to lay out an equation answer
TS Grewal style answers use a statement with a column for each asset and each liability plus capital, and one row per transaction. On paper, draw it exactly that way: list the transactions down the side, and after each one write the new balance of every column plus a total for each side. The solutions below say the same thing in sentences because this site publishes plain text, but the sequence is identical: state the effect of the transaction, update the affected items, then prove assets equal liabilities plus capital. Two rules cover ninety percent of entries. Anything the business owns or is owed sits on the asset side; anything it owes sits on the other side along with capital. And every expense, income, profit, loss or drawing lands in the capital column, because the owner absorbs whatever outsiders do not.
The four shapes every transaction takes
Each transaction does one of four things to the equation. One asset can replace another, like buying goods for cash, and the totals stand still. Both sides can rise together, like a credit purchase or a loan received. Both sides can fall together, like paying a creditor or the owner withdrawing cash. Or the right side can rearrange within itself, like an outstanding salary that raises a liability while lowering capital. When a question asks for the effect of a transaction, name the shape and the specific accounts. When you build a full statement and a line refuses to balance, the fault is nearly always a forgotten capital adjustment: profit not added, or an expense or drawing not subtracted. Question 5 below is pure shape-spotting practice, and the FAQ has a repair checklist.
Where Chapter 5 sits in the book
In the 2025-26 edition the accounting equation is Chapter 5, following Bases of Accounting and immediately before Accounting Procedures, the rules of debit and credit. That ordering is deliberate. Debit and credit are the equation with names attached: every debit records what the next chapter calls an increase in assets or expenses, every credit an increase in liabilities, capital or income, and the equality you prove line by line here becomes the reason a trial balance must tally in Chapter 14. Some solution websites still number this chapter as 2 or 6 from older editions, so match by topic name if your book looks different. Whenever you get stuck, the fastest repair is to go back to the last line that balanced and push one transaction through at a time.
Worked questions, step by step
Show the effect of these transactions on the accounting equation: Ritu starts business with cash Rs 3,00,000; buys goods for cash Rs 80,000; sells goods costing Rs 30,000 for Rs 42,000 cash; pays rent Rs 5,000.
- Start: cash Rs 3,00,000 = capital Rs 3,00,000. Assets Rs 3,00,000, liabilities nil.
- Buying goods for cash swaps one asset for another: cash falls to Rs 2,20,000 and stock rises to Rs 80,000. Totals unchanged at Rs 3,00,000.
- The cash sale brings in Rs 42,000 and removes stock of Rs 30,000, so the Rs 12,000 difference is profit added to capital. Now cash Rs 2,62,000 plus stock Rs 50,000 = Rs 3,12,000, and capital is Rs 3,12,000.
- Rent reduces cash by Rs 5,000 and, being an expense, reduces capital by Rs 5,000. Cash Rs 2,57,000 plus stock Rs 50,000 = Rs 3,07,000, and capital is Rs 3,07,000.
- Final check: assets Rs 3,07,000 = liabilities nil + capital Rs 3,07,000. It balances.
Answer: Closing equation: cash Rs 2,57,000 + stock Rs 50,000 = capital Rs 3,07,000.
Where marks slip: Write the fresh totals after every transaction, not just at the end. In the usual 4 to 6 mark equation question, each correctly updated line carries marks even if a later line slips.
Try one yourself: Start with cash Rs 1,50,000; buy goods for cash Rs 40,000; sell all of them for Rs 55,000 cash. Find the closing capital. (Answer: Rs 1,65,000)
A business has cash Rs 1,00,000 and capital Rs 1,00,000. Show the equation after it buys goods on credit for Rs 60,000, pays creditors Rs 25,000, and buys furniture for cash Rs 15,000.
- The credit purchase raises stock and creates a liability: cash Rs 1,00,000 + stock Rs 60,000 = creditors Rs 60,000 + capital Rs 1,00,000. Both sides Rs 1,60,000.
- Paying creditors Rs 25,000 reduces cash and creditors together: cash Rs 75,000 + stock Rs 60,000 = creditors Rs 35,000 + capital Rs 1,00,000. Both sides Rs 1,35,000.
- Buying furniture swaps cash for furniture: cash Rs 60,000 + stock Rs 60,000 + furniture Rs 15,000 = creditors Rs 35,000 + capital Rs 1,00,000. Both sides still Rs 1,35,000.
Answer: Closing equation: cash Rs 60,000 + stock Rs 60,000 + furniture Rs 15,000 = creditors Rs 35,000 + capital Rs 1,00,000.
Where marks slip: Notice which transactions change the totals: a payment to creditors shrinks both sides, while an asset swap changes neither. Saying this in a sentence shows the examiner understanding, not just arithmetic.
Try one yourself: From the closing position above, the firm returns goods costing Rs 5,000 to a creditor. New creditors figure? (Answer: Rs 30,000, with stock falling to Rs 55,000)
On 31 March 2026 a trader has cash Rs 24,000, debtors Rs 56,000, stock Rs 90,000 and machinery Rs 2,30,000. He owes creditors Rs 70,000 and a loan of Rs 50,000. Use the accounting equation to find his capital.
- Total the assets: Rs 24,000 + Rs 56,000 + Rs 90,000 + Rs 2,30,000 = Rs 4,00,000.
- Total the external liabilities: Rs 70,000 + Rs 50,000 = Rs 1,20,000.
- Capital = assets minus liabilities = Rs 4,00,000 minus Rs 1,20,000 = Rs 2,80,000.
Answer: Capital is Rs 2,80,000.
Where marks slip: Label the two subtotals clearly. Examiners award the asset total and the liability total separately before the final figure, so a slip in one does not sink all three marks.
Try one yourself: Assets are Rs 5,25,000 and capital is Rs 3,45,000. Find the liabilities. (Answer: Rs 1,80,000)
Meera's capital was Rs 2,50,000 on 1 April 2025 and Rs 3,10,000 on 31 March 2026. During the year she withdrew Rs 40,000 and brought in fresh capital of Rs 25,000. Find her profit for the year.
- Closing capital already reflects profit, drawings and fresh capital, so unwind them: profit = closing capital + drawings minus fresh capital minus opening capital.
- Substitute: Rs 3,10,000 + Rs 40,000 minus Rs 25,000 minus Rs 2,50,000.
- That is Rs 3,50,000 minus Rs 2,75,000 = Rs 75,000.
Answer: Profit for the year is Rs 75,000.
Where marks slip: Get the signs by reasoning, not memory: drawings made closing capital smaller, so add them back; fresh capital made it bigger, so take it out. One line of that reasoning protects you if the layout is unfamiliar.
Try one yourself: Opening capital Rs 1,80,000, closing capital Rs 2,44,000, drawings Rs 20,000, no fresh capital. Find the profit. (Answer: Rs 84,000)
State the effect of each on the accounting equation: (a) received Rs 18,000 from a debtor, (b) salary of Rs 7,000 is outstanding at the year end, (c) depreciation of Rs 4,000 is charged on machinery.
- (a) Cash rises by Rs 18,000 and debtors fall by Rs 18,000. One asset replaces another and the totals do not change.
- (b) The outstanding salary creates a liability of Rs 7,000, and being an expense it cuts capital by Rs 7,000. Assets are untouched; the right side rearranges within the same total.
- (c) Depreciation reduces machinery by Rs 4,000 and capital by Rs 4,000, so both sides fall together.
Answer: (a) no change in totals; (b) liabilities up Rs 7,000 and capital down Rs 7,000; (c) assets and capital both down Rs 4,000.
Where marks slip: These one-line effect questions are quick marks. Always name the specific asset or liability involved, not just the side of the equation.
Try one yourself: Goods costing Rs 2,000 are given away as charity. Effect? (Answer: stock down Rs 2,000 and capital down Rs 2,000)
Prepare the accounting equation: Manu starts business with cash Rs 2,00,000 and his own furniture worth Rs 50,000; buys goods on credit Rs 40,000; withdraws cash Rs 10,000 for personal use; sells goods costing Rs 25,000 on credit for Rs 35,000.
- Start: cash Rs 2,00,000 + furniture Rs 50,000 = capital Rs 2,50,000. Personal assets brought in count as capital just like cash.
- Credit purchase: add stock Rs 40,000 and creditors Rs 40,000. Assets Rs 2,90,000 = creditors Rs 40,000 + capital Rs 2,50,000.
- Drawings: cash falls to Rs 1,90,000 and capital falls to Rs 2,40,000. Both sides now total Rs 2,80,000.
- Credit sale at a profit: debtors rise by Rs 35,000, stock falls by Rs 25,000, and the Rs 10,000 profit lifts capital to Rs 2,50,000.
- Check: cash Rs 1,90,000 + furniture Rs 50,000 + stock Rs 15,000 + debtors Rs 35,000 = Rs 2,90,000, and creditors Rs 40,000 + capital Rs 2,50,000 = Rs 2,90,000.
Answer: Closing equation: assets Rs 2,90,000 = creditors Rs 40,000 + capital Rs 2,50,000, made up of cash Rs 1,90,000, furniture Rs 50,000, stock Rs 15,000 and debtors Rs 35,000.
Where marks slip: When the owner brings in a personal asset like furniture, it is capital exactly as cash would be. Missing this in the opening line throws every later total off, and examiners mark the opening line first.
Try one yourself: Same start, but Manu also takes a bank loan of Rs 60,000 received in cash. Opening totals? (Answer: assets Rs 3,10,000 = loan Rs 60,000 + capital Rs 2,50,000)
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Solve my question →Quiz me on this topicQuestions students ask
Are these the actual TS Grewal Chapter 5 solutions?
No. The book is copyrighted, so its questions are not reproduced here. These are original questions built to cover the same transaction types and difficulty as the 2025-26 Chapter 5, each solved in full. Work the book's own questions too; the method shown here transfers directly.
Does profit really go into the capital column?
Yes. Profit, losses, expenses, incomes, drawings and interest on capital all adjust the capital figure, because the owner ultimately absorbs them. If a statement refuses to balance, the missing piece is almost always one of these capital adjustments.
My equation does not balance. What do I check first?
Four things, in order: did you add the profit on any sale (selling price minus cost) to capital; did you subtract drawings from both cash and capital; did you accidentally move cash on a credit transaction; and did every expense reduce capital as well as the asset it was paid from. One of those four fixes it nearly every time.
Is the accounting equation Chapter 2 or Chapter 5?
In the 2025-26 TS Grewal edition it is Chapter 5. Some older editions and several solution websites number it differently, which is why chapter lists online disagree. Match by the topic name, Accounting Equation, and you cannot go wrong.