Consider the following transactions of a new venture in Duluth named Duluth Ducks, started by two partners Jack and Jill. DuluthDucks manufactures winter clothing for industrial workers. The firm started business in July 2019 and the following transactions took place during the year up to the end of December 2019. Post the transaction in the table provided on the next page. Based on these transactions, create an Income statement (from Revenues to EBT i.e. ignore tax for all reports) and a Balance sheet for the end of the year 2019. Transactions (all figures are in USSS): i. ii. iii. iv. vi. vii. viii. ix. X. XI. xii. xiii. Jack and Jill contributed 50,000 each towards the equity of the new firm. They further get a loan of 25000 from the bank at 20 percent/year. The principal of the loan will be returned after two years They purchased cutting and stitching equipment worth 50,000, paying cash. The equipment has a life of five years, after which they cannot be used and will have zero market value. They spent $2,000 on supplies and fabric, which they charged on the account (credit). They spent 1000 on the advertisement, for which they will pay in January 2020. Rent for the workspace they have leased is $1.000 a month, which was paid for six months in advance. During the period July to December, they used up all their supplies and fabric to make 1000 jackets All the jackets were sold for 75 each, but only half of the funds were received in cash. The rest will be paid next year. They paid the only tailor working with them 2500 per month in cash. A new customer paid an advance payment of 30,000 for jackets to be supplied next year The interest owed to the bank was paid at the end of the current year, but the principal will not be paid for the next two and a half years. They paid $1000 towards supplies account for the fabric and supplies towards the end of the year and the rest will be paid in March 2020. They recorded six months of depreciation on the equipment on a straight-line basis. 2 Accounting Transactions Cash 30,000 25,000 (30,000) (6000) Accounts receivable (1000) Assets Inventory Equipment Depreciation (2000) 2000 3750037500 (2000) (15.000) 30,000 2000 1000 50,000 5000 Liabilities Accounts Payable 2000 1000 Long term debt 25,000 Common Stock 50.000 Owner's Equity Retained Revenue Earnings Expenses (1000 (6000) 7500 (2000) (15,000) (30.000)