3.

March 4 4

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21 24 25

25 26

27

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Mann Lee commenced business providing pet grooming services on 1 March 2014, by contributing equipment at $4,800, a commercial van at $23,000 and cash of $2,300. Transactions during March for Lee Grooming Services were as follows (Ignore GST):

Leased premises and paid two months rent $700 in advance. Purchased office and grooming supplies worth $400, paying $100 cash and the rest on credit.

Interviewed, followed by hiring a grooming assistant at an agreed wage of $600 fortnightly.

Sent invoices for $1,525 earned from providing grooming service to a few customers on credit.

Paid balance on office & grooming supplies purchased on credit on 4 March.

Lee withdrew $500 cash for personal use.

Received cash of $250 from accounts receivable.

Received advice that $200 of accounts receivable was not collectable and the figure was written off as an expense.

Paid vehicle maintenance and Petrol expenses $385.

Received cash of $180 from accounts receivable after allowing for a $10 discount considered as a necessary expense to speed up collection.

Stock take of office supplies showed $85 worth of the supplies has been used.

Paid the fortnightly wages to assistant $600.

At the end of the month when preparing financial statements, the following adjustment are made:

- The rent expense incurred for the month is recognised.

- Depreciation for the vehicle and the equipment of $200 and

$100 respectively are recognised.

- Although the electricity invoice will only be received in the next

month, the electricity usage for the current month estimated to be $100 is recognised.