Lewis Edwards decides to branch out on his own and set up his own private practice as an accountant. Events occurring in March 2019 are as follows. Ignore GST.

Required

(a) After analyzing the events above, suggest a chart of accounts, with appropriate numbering, that would be satisfactory for the business. Explain why you have used particular numbering in the chart of accounts.

(b) Prepare general journal entries as necessary for each of the events, using the chart of accounts that you have created.

(c) Explain why you have made these journal entries by an analysis similar to that shown in the illustrative example in the chapter.

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March 1 23 4 Deposited $500 000 into a business bank account, set up under the business name of Lewis Edwards, Accountant. Hired an office secretary who commenced work immediately. Paid $6200 for the first month's rent of a suitable office. Purchased office equipment and furniture for a total of $43 800. An initial $3800 is paid in cash immediately and the rest is to be paid in 3 months' time, with interest payable at 10% p.a.