1. Initial capital refers to any funds and other assets invested into the business by the owner at the beginning of the trading period.
2. Final capital refers to the business capital at the end of the trading period. Thus, final capital is initial capital when it has been influenced by factors such as additional investment, profits, drawings and losses
The formula for determining initial capital is represented as follows:
Initial capital =final capital – addition investment – net profits +drawings
i.e : I .C = F.C - I - P + D
Wilfykil answered the question on February 28, 2019 at 06:16
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Date posted: February 28, 2019. Answers (1)
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Sh.
Creditors 15,800
Equipment 46,000
Motor Vehicle 25,160
Stock 24,600
Debtors 23,080
Cash at bank 29,120
Cash in hand 160
During the first week of May 2002 Moody:
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c. Paid creditors by cheque Sh.3,160.
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(c) Goods are delivered to the customer.
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(iii) The proprietor invested into the business from her personal saving Sh. 600,000
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Omolo- Sh. 27,000
Tina- Sh. 56,000
March 5: Cash sales Sh. 87,000
March 6: Paid wages in cash Sh. 14,000
March 7: Sold goods on credits to
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Jane- Sh. 42,000
Juma- Sh. 72,000
March 9: Bought goods for cash Sh. 46,000
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Ndebu-Sh. 98,000
March 12: Paid wages in cash Sh.465, 000
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Juma- Sh. 23,000
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