Jack Smith, a baker, has been working at his friend$$s bakery a part time basis for the past $3$ years. As of January $1,2018,$ Jack decided to pursue his own dreams of buying and selling pastries. He rented a space from his friend and entered into the following transactions during January $2018$:

Jan $1$ Jack invested the following assets into the business: cash, $$12,000$; office equipment, $$30,000$ and a bank balance of $$80,000.$

Jan $2$ Paid rent for January by cheque $$14,000$

Jan $2$ Purchased motor vehicle on credit from Deals on Wheels Ltd$.$ for $$50,000.$

Jan $3$ Bought office furniture from Kurtz JA$.$ Ltd$,$ paying by cheque $$15,000$

Jan. $3$ Bought merchandise for resale by cheque $$20,000.$

Jan $3$ Sold merchandise to Candy Lou, for cash $$10,000.$

Jan $4$ Sold merchandise on credit to Patrick Poser $$40,000.$

Jan $5$ Sold merchandise on credit to Janice Russell $$4,500.$

Jan $6$ Patrick Poser settled his account with cash receiving a $5\%$ cash discount.

Jan $6$ Merchandise valued at $$1,050,$ sold to Janice Russell on January $5,$ was returned to Jack Smith. A credit note was given to Janice Russell.

Jan $7$ Sold merchandise on credit to J$.$F$.$ Mills Ltd $$33,000.$

Jan $8$ Bought merchandise on credit from Natalie Lowe $$12,000.$

Jan $11$ Received a long term loan from JNBC Bank for $ $45,000$ by cheque.

Jan $11$ Bought stationery for cash $$12,000.$

Jan $15$ Bought merchandise on credit from Nickette Morgan $$17,500.$

Jan $18$ Lodged cash of $$13,500$ to the business bank account

Jan $20$ Jack took pastries for his daughter$$s $5$th birthday party amounting to $$7,000$

Jan $20$ Paid Natalie Lowe $$10,800$ in full settlement of the balance outstanding by cheque having received a discount of $$1,200.$

Jan $25$ Commission was received by cash, $$5,000.$

Jan $12$ Paid wages by cash $$15,000.$

Jan $27$ Purchased merchandise on credit from Kukupas Creations for $$8,000.$

Jan $30$ Paid electricity by cash $$5,600,$ insurance $$12,000$ by cheque.

REQUIRED:

a$)$ Journalize each of the above transactions. Narratives are not required.

b$)$ Post all the above transactions in the General ledger $(($please use only the general ledger$))$

c$)$ Extract an unadjusted trial balance as at January $31,2018$ with the inclusion of the appropriate headings

d$)$ Journalize the following adjusting entries using the following information:

$$ An employee was short paid $$500$ for the month of January as it relates to wages.

$$ Seven hundred dollars $($$$700)$ of the commission received related to the month of February $2018$

$$ Rent was prepaid by approximately $$1,500.$

$$ The amount paid for insurance, represents the total amount for the entire year.

$$ For the first month of business, depreciation is calculated at $10\%$ per annum on the straight$-$line basis on office furniture and office equipment, for motor vehicle and the rate is $5\%$ per annum using the straight line basis; depreciation is charged to the accounts on a monthly basis.

$$ It appears that $$3,700$ of the J F Mills balance has to be written off as bad debt

Note: when doing the adjusted T accounts, only the accounts that have been affected need to be done.

e$)$ Post the above adjusting entries to their respective accounts in the general ledger creating additional accounts as the journals would dictate.

f$)$ Prepare an adjusted trial balance with the inclusion of the above balances and new accounts.

g$)$ Prepare the Statement of Profit or Loss and the Statement of Financial Position for the period under review. Please include the appropriate headings. For use in the financial statements, closing stock amounts to $$3,000$ at the end of the month.

$*$Ensure to calculate the depreciation on a straight line which means to calculate it as a percentage of the value of the asset