1. On 1 September 20.18 Mr Will Turner started a new blacksmith business called Iron Duke. Iron Duke manufactures and sells domestic cast iron furniture.

The following transactions took place during the first financial year of the entity ending 31 August 20.19.

Interest incurred on the purchase of a CNC machine on credit from Big Traders was R660 for the year; no payments or entries regarding this interest were made yet in the books of Iron Duke. - Interest due on the long-term loan was R12 500 for the year ending 31 August 20.19 and was paid in cash on 2 September 20.19.

On 31 August 20.19, Mr Will Turner, decided to trade-in the old delivery van for a new delivery van. The trade-in value was R14 500, and the cost of the new delivery van was R60 000, with the difference settled in cash. (You only need to do the entry for the acquisition of the new delivery van.) Show the effect of each transaction on the basic accounting equation with a plus sign (+) for an increase and a minus sign (-) for a decrease next to each amount under each element. Also indicate the account(s) that will be affected by each transaction next to the affected elements for the financial year ended 31 August 20.19. (The business makes use of the perpetual inventory system

Accumulated depreciation: Buildings Depreciation N/A Accumulated depreciation: Machinery Accumulated depreciation: Vehicles Buildings Vehicles Machinery +2475 1500 +975