Phase 2 Bulding advanced Financial Statements Investment Advisers Ltd. (IAL) January 1st File documents with regulatory authorities to create a new legal company called Investment Advisers Ltd (IAL). The company will offer: - a new book written by the founder - electronic newsletters specialised on financial analysis Initially capitalize the company through the deposit of 50 000 from the 3 owners. Sign a lease for office/wharehouse space and pay a deposit for 2000 . This is a a refundable deposit. The office will mainley be used for administrative tasks. January 1st Borrow 12 000 from the bank for working capital (see the loan table for details). Purchase office equipment for 6 000 (for administrative purposes). The equipment has an estimated life of 2 years with no whage value. It is paid cash. Purchase a vehicle for 20 000 (for distribution). It is paid cash. The vehicle an estimated life of 100 000 km with no salage value. January 10th Purchase and receive 500 books at a cost of 20 per book for a total of 10 000 Invoice terms are that payment from IAL is due in 60 days. No cash changes hands. These books are intended for resale. Spend 300 on newspaper and trade magazine advertising for the month. January 15th ship first order to a customer consisting of 25 books at 150 per book. Invoice terms are that payment id due in 30 days. No cash changes hands. Sell for cash 10 books at 140 per book at an investment conference. Hire a part-time clerk to keep the accounting books and do other administrative work. The clerk is hired through an agency thathandles all payeroll taxes. The company is to pay 15 per hour to the agency. The clerk works 6h in January, but no cash will be paid til February January 31st Pay 600 to landlord for office/wharehouse space for the first month's rent. End of period operations Adjust book value of property, plant & equipment Adjust interest payable for the loan January 31st: adjust PPE value Adjust value of property and equipment: office equipment was purchased Jan 1st for 6 000 . The equipment has an estimated life of 2 years with no salvage value Purchased a vehicle for 20 000 on Jan 15th. The vehicle has an estimated life of 100 000 km with no salvage value. At the end of January mileage on the vehicle is 15 000 km. January 31st: adjust loan Adjust loan: Borrowed 12 000 (Jan 1st) from the bank(see loan table)