Bismac Inc, was created January 2, 20x5. Bismac Inc operates a rap recording studio, the following transactions occured during the year ended December 31, 20x5.

1. The owner Biyombo, invested $300,000 of his own money into the company in exchange for common shares.

2. The company borrowed $500,00 from a local bank on January 31, 20x5. The interest on the loan is 6% and is payable annually each January 31st.

3. On February 28, 20x5, purchased and renovated a room at a cost of $500,000. The expected useful life of the studio is 40 years with no residual value.

4. On March 31, 20x5, Bismac Inc purchased recording equipment on account in the amount of $300,000. The equipment has a useful life of 10 years with no residual value.

5. On March 31, 20x5 purchased and paid for a two year comprehensive insurance policy ont he building and equipment at a cost of $6,00.

6. Purchased supplies of $5,600 during the year. By the end of the year, there were $1,200 of supplies remaining.

7. Total billings to customers using the studio during the year totaled $350,000. by the end of the year, $290,000 of this amount was collected. Biyombo believes taht of the $60,000 owing, he will be able to collect $50,000.

8. Total expense for the year totaled $260,000. At the end of the year, all of these were paid with the exception of $25,000 of invoices.

Question: Prepare journal entries to record the above. For each entry, if necessary, write the intial entry and then write an adjusting entry.

Prepare a Statement of Income for Bismac Inc for the year ended December 31, 20x5