# Problem 1

State whether the following events form accounting transactions or not for the business of Mr. M (proprietor)

1. Mr. M started business with capital (brought in cash) 20,000
2. Paid salaries to staff 3,000
3. Purchased Machinery for 10,000 in cash
4. Placed an order with Sen & Co. for goods for 2,000
5. Opened a bank account by depositing 2,000
6. Received pass book from bank
7. Appointed Mr. B. Sen as manager on a salary of 1,000 per month
8. Received interest from bank 300
9. Received a price list from B

# Solution

1. Yes

It can be measured in terms of money. Cash is coming into the business.

2. Yes

It can be measured in terms of money. It reduces the cash balance of the business.

3. Yes

It can be measured in terms of money. It reduces the cash balance of the business.

4. Yes

It can be measured in terms of money. It reduces the cash balance of the business.

5. Yes

It can be measured in terms of money. It reduces the cash balance of the business.

6. No

It can not be measured in terms of money.

7. No

It can not be measured in terms of money.

8. Yes

It can be measured in terms of money. It increases the cash balance of the business.

9. No

It can not be measured in terms of money.