Mark Dingo operates Supreme Riding School Pty Ltd. The riding school's main sources of revenue are riding fees and lesson fees, which are provided on a cash basis. Mark also boards horses for owners, who are invoiced monthly for boarding fees. In a few cases, boarders pay in advance of expected use. For its revenue transactions, the riding school maintains these accounts: Cash, Accounts Receivable, Revenue Received in Advance, Riding Revenue, Lesson Revenue, and Boarding Revenue. The riding school owns twenty horses, a stable, a riding field, riding equipment and office equipment. These assets are accounted for in accounts Horses, Building, Riding Field, Riding Equipment, and Office Equipment. The riding school employs stable helpers and an office worker, who receive weekly salaries. At the end of each month, the mail usually brings invoices for advertising, electricity and veterinary services. Other expenses include feed for the horses and insurance. The riding school also maintains the following accounts: Hay and Feed Supplies, Prepaid Insurance, Accounts Payable, Salaries Payable. Salaries Expense. Advertising Expense. Electricity Expense, Veterinary Expense, Hay and Feed Expense, and Insurance Expense. Mark Dingo's sole source of personal income is dividends from the riding school. Thus, the business declares and pays periodic dividends. To record equity in the business and dividends, two accounts are maintained: Share Capital and Dividends. During the first month of operations an inexperienced bookkeeper was employed. Mark asks you to review the following eight general journal entries of the 50 entries made during the month. In each case, the explanation for the entry is correct. 200 000 10 000 5 000 5 000 10 000 May I Cash 200 000 Share Capital (Issued shares in exchange for $20 000 cash) 2 Salaries Expense 10 000 Salaries Payable (Hired employees services for the month) 5 Cash 5 000 Accounts Receivable (Received $5000 cash for lesson fees) Cash 5 000 Boarding Revenue (Received $5000 for boarding of horses beginning 1 June) 9 Hay and Feed Expense 10 000 Cash (Purchased estimated 5 months supply of feed and hay for $10 000 on account) 14 Riding Equipment 2 50 Cash (Purchased desk and other office equipment for $2500 cash) 15 Salaries Expense 6 000 Cash (Issued cheque to Mark Dingo for personal use) 20 Cash 31 500 Riding Revenue (Received $13 500 cash for riding fees) 31 Veterinary Expense 6750 Accounts Receivable (Received invoice of $6750 from veterinarian for 2 500 6 000 13 500 6 750 Required With the class divided into groups, answer the following: (a) State which journal entries are correct. For each journal entry that is incorrect, prepare the entry that should have been made by the bookkeeper. (b) Which of the incorrect entries would prevent the trial balance from balancing? (c) What was the correct profit for May, assuming the bookkeeper originally reported profit of $15 100 after posting all 50 entries? (Hint: Assume errors occurred only in the 8 entries reported above, i.e. the remaining 42 entries were recorded correctly.) (d) What was the correct cash balance at 31 May, assuming the bookkeeper reported a balance of only $20 650 after posting all 50 entries