Complete transaction analysis and prepare financial statements The following transactions occurred for the month of November 2022 for Hoad Ltd:

a The company was incorporated, with shareholders investing $200 000 in cash.

b Purchased inventory for cash, $20 000.

c Paid $4000 for a month’s rent on the premises.

d Purchased inventory on credit, $30 000.

e Received an advertising bill for a newspaper advertisement to promote the new company. The $1000 bill will be paid in December.

f Inventory with a cost of $40 000 was sold on credit for $90 000.
g Paid $25 000 of accounts payable.
h Received $30 000 from accounts receivable.
i Paid wages of $15 000.
j Paid sales commission at the rate of 1 per cent on sales made during the month.
k Purchased a new computer for $6000; paid $3000 in cash and $3000 to be paid in 15 months time.
l Owed employees $2000 in wages at the end of the month.
Required:
1 Show the effect of each of the transactions on the accounting equation.
2 Prepare an income statement and a balance sheet at 30 November 2022.
3 Prepare journal entries for each transaction and determine the balance for each account.
4 For each transaction a to l, what is the effect on net profit and total assets? Write ‘increase’, ‘decrease’ or ‘no effect’ for each transaction.