Quake Company experienced the following transactions and events in July 2020

Analyse the above and prepare the necessary entries to describe them for the month of July 2020.

Question 1 Quake Company experienced the following transactions and events in July 2020. (1) On 1 July 2020, the company signed a Letter of Intent with Benson Company to purchase a new equipment costing $30,000. No deposit was made. The equipment will be delivered in September 2020. (2) On 1 July 2020, the company purchased a 6-month insurance policy for $1,200. (3) On 1 July 2020, the company borrowed $50,000 by signing a 12-month 12% note payable. The entire amount, plus interest, is due one year later. (4) On 10 July 2020, the company purchased $5,000 supplies on credit. On 15 July 2020, Clarke Company files a lawsuit against Quake Company for $200,000. Quake's Company's attorney assesses that the lawsuit is without merit. (6) On 20 July 2020, the company paid $10,000 cash for advertisement published in the local newspaper. On 25 July 2020, the company decided to hire one more full-time staff at a monthly salary of $4,000. The new staff will join the company on 1 August 2020. (7) (8) On 28 July 2020, the company completed a $20,000 job that has not been billed. (9) On 31 July 2020, the company paid $12,500 to its employees for the month of July 2020. Analyse the above and prepare the necessary entries to describe them for the month of July 2020