Dayspring Ltd undertakes the following activities in its first week of existence;

1 Starts its activities by raising £50,000 from the issue of 50,000 £1 shares, and putting this money into a new bank account.

2 Buys a workshop for £30,000, paying by cheque.

3 Buys two delivery vans for £8,000 each, paying by cheque.

4 Interviews and appoints two employees, to start work next week.

5 Borrows £10,000, agreeing to repay it in one lump sum, with interest, in two years’ time. Puts the money into the bank account.

6 Buys machinery for £15,000 on credit from Hartford Supplies.

7 Decides that it does not need two delivery vans, and sells one of them on credit to Sunset Garages for £8,000.

Required
There are three questions for you to deal with:

1 Prepare the balance sheet at the end of the week. You could do this by preparing successive balance sheets after each relevant transaction, but this would be rather clumsy and time-consuming. For a fairly small set of transactions like this, it is probably better, therefore, to simply keep a rough record of the balance of each item. The workshop, for example, starts at £30,000 and then does not change, and so will appear in your balance sheet at £30,000. The bank account will take more analysis.

You may find it helpful to use the Sunrise Ltd balance sheet (above) as a guide to the correct layout.
2 Justify your treatment of transaction (4).
3 Suggest two groups who would probably be particularly interested in the balance sheet you have prepared. Briefly note down why each would be interested.