Question 1: Structured Question(7\%) During the month of December 2022, the following transactions took place in a newly established sole trader business (each group will need to give this business a name): December 1 Rented building for $60,000 per month, paying cash to the landlord. December 1 Commenced business with $500,000 in the bank, $200,000 cash, motor vehicle valued at $1,500,000, and a computer valued at $200,000. December 2 Purchased goods from L. Matheson on credit for $320,000. December 3 Paid insurance for the motor vehicle using cash amounting to $50,306. December 5 Sold goods to P. Jarrett for cash amounting to $200,000. December 5 Returned goods to L. Matheson worth 58,500 . December 6 Sold goods on credit to L. Frazer worth $80,000. December 9 Paid L. Matheson $200,000, using a cheque. December 15 Purchased goods valued at $100,000 from S. Small using a cheque. December 16 L. Frazer returned goods valued at $6,400. December 21 Sold good to S. Jones for $93,00 cash. December 22 Paid electricity bill amounting to $31,200 using a cheque. December 22 Paid telephone bill amounting to $10,400 using a cheque. December 23 Received $73,600 cash from L. Frazer. December 23 The business owner withdraws cash valued at $30,000 to purchase Christmas gifts for their children, as well as goods valued at $20,000 to give to their other family members. December 31 Paid cash amounting to $9,304 for water bill. Note: At the end of December 31, 2022, there was stock valued at $270,000 in the business' storeroom. tequired: a) Perform all the relevant steps in the accounting cycle which will allow for you to prepare and present the business' journal entries, general ledger entries, trial balance and the Profit or Loss Statement as well as the Statement of Financial Position for the month of December 2022. b) If you were given the following additional notes for this business at the end of December 2022, how would the Profit or Loss Statement, as well as the Statement of Financial Position be different: i) Stock on December 31,2022 , valued at $33,000 was not included as part of the figure for closing stock and it is deemed to be material. ii) Insurance was prepaid by $4,300. iii) Electricity was owing by $10,300. iv) Depreciation charges are to be applied to motor vehicle using a rate of 10% per annum using the straight-line method. v) Depreciation charges are to be applied to computer using a rate of 15% per annum using the reducing balance method. NB. You will need to redo the Profit or Loss Statement, as well as the Statement of Financial Position for the month of December 2022, to incorporate these adjustments
