On $1$ January $2020$ Tom started business as T Ltd with $$20,000,60\%$ from his own savings and $40\%$ from a bank loan.

On $2$nd of January $2020,$ T Ltd purchased land and equipment for $$10,000$ cash down, broken down as follows: Equipment $$5,000(5$ year life, no residual value$)$ and Land $$5,000.$

During its first year of trading, T Ltd also purchased $5,000$ units of inventory at $$1$ each on credit. T Ltd sold $4,000$ units at $$3$ per unit on credit to customers. T Ltd employs one sales person and pays him $$4,000$ a year.

The loan is repayable in equal annual instalments $($principal plus interest$)$ of Rs$2,634$ over a four year term $($see table below$).$ The interest rate is $12\%$ per annum. At $31$ December $2020,$ T Ltd paid the required sum to the bank as per the following loan pay off table:

Loan Payoff table

Year Loan principal at start of year Interest charge at end of year $(12\%)$ Instalment $($principal $+$ interest$)$ paid at end of year Principal repaid at end of year Loan principal at end of year

$20208,000960263416746,326$

$20216,326759263418754,451$

$20224,451534263421002,351$

$20232,351283263423510$

Totals $2536105368000$

At $31$ December $2020,$ the customers paid $$10,000$ on their account.

At $31$ December $2020,$ T Ltd paid suppliers $70\%$ of the amount due.

Tax is levied at $25\%$ on accounting profits before tax and is paid in the year in which profit is earned.

The Land was deemed to be worth $$6,000$ at $31$ December $2020$ and this figure is to be reflected in the books.

Required:

Prepare for T Ltd

$($i$)$ The accounting equation as at $31$ December $2020(10$ marks$)$

$($ii$)$ the statement of financial position as at $31$ December $2020(10$ marks$)$

$($iii$)$ the statement of profit or loss and other comprehensive income for the year ended $31$ December $2020(10$ marks$)$