1. Prepare the 5 regular transactions & 5 adjusting transactions. Please provide as much of an audit trail of how calculations are derived (use formulas as you can).

2. Prepare the following financial statements in proper form: a. Income Statement b. Statement of Changes in Stockholders' Equity c. Balance Sheet

REGULAR TRANSACTIONS NOT RECORDED YET: KPF had received a payment from collected $20,000 of her accounts receivable TRANSACTION 1 during December and forgot to record it. KPF sent gift baskets to her customer list for the holidays. This cost a total of $3,000 TRANSACTION 2 which Katelyn paid for in December 2022. KPF landed a new corporate customer in December 2022 who wanted to pay $120,000 for a 12 month subscription to the dog walking service. The subscription starts on January 1, 2023. The customer asked if this purchase could be on account TRANSACTION 3 and payment would be made in January. KPF paid her staff an extra salary amount at year end as a bonus payment for a successful year's business. This amount was $4,000 and was paid to the employees TRANSACTION 4 in December 2022. KPF had a customer who paid $2,000 cash for the dogs walked during the last week TRANSACTION 5 of December 2022. ADJUSTING TRANACTIONS NOT RECORDED YET: NOTE: Adjusting entries are generally recorded every month, and all prior month's entries have been properly recorded. Only the below AJE's for December still need to be recorded. KPF noticed in the unearned revenue balance, that $25,000 of the balance was earned by dog walking for her customers in December 2022. Katelyn had not TRANSACTION 1 recorded this as yet. KPF pays their employees every Wednesday. The 2022 year ended on a Friday, but she did not pay the employees for the two days they worked in 2022 until the TRANSACTION 2 following week (which was in January 2023). This amount totaled $17,500. TRANSACTION 3 KPF did not record the insurance expense for the month of December 2022 of $8,000. KPF had an advertising campaign done in December 2022 by a marketing firm. TRANSACTION 4 Katelyn found the invoice on her desk for $11,000 and it was not due until January. KPF did not send an invoice to a customer for the month of December 2022 dog TRANSACTION 5 walking services of $9,000. You can put all three financial statements on this tab. a. Income Statement b. Statement of Changes in Stockholders' Equity c. Balance Sheet