JJ decided to start a business that he runs as a sole proprietor.

The following transactions took place in his first month of trading:

1 April Capital of 80,000 was introduced by JJ. 75,000 was paid into the bank and 5,000 was kept as cash in hand

6 April Goods were purchased for 12,000 and paid by cheque

7 April JJ purchases goods worth 2,000 on credit from Tooley

7 April Sales of 16,000 were made to Mooney on credit

9 April Rent was paid at the cost of 2,800 by cheque

14 April Computers and other office equipment were purchased for 40,000 by cheque

18 April JJ paid his nieces nursery school tuition costing 2,000 from the business bank account

20 April Mooney returns goods worth 200

20 April Tooley offered JJ a 5% cash discount if payment is made within 7 days

23 April JJ returns goods which he had originally bought for 320 by cheque

26 April JJ withdraws 3,600 cash from the bank

26 April JJ pays Tooley account by cheque.

Required:

1. Journalise the entries
2. Indicate their effects (up, down, no effect) on the accounting equation
3. Post each transaction in the appropriate T-accounts & compute the balances in each of the T-accounts
4. Use the amounts in the T-account balances to advice JJ in an email format about the financial state of his business.