Question 1 Virtual Yoga is a company started by Arun in 1 January 2020 during the COVID pandemic. It conducts various live stream courses on yoga. Its revenue is derived from fees paid by students on a quarterly or semi-annually basis. It also conducts classes for employees of companies. Recently, its accountant has contracted COVID and was hospitalised. You are being asked to help to finalise drawing up the Trial Balance as of 31 December 2021. Account title Debit () Credit (S) Share capital (S80,000 shares at $1.00 each) 80,000 Retained earnings, 31 Dec 2020 19,750 Training equipment at cost 20,000 Furniture and fittings at cost 20,000 Accumulated depreciation, 31 Dec 2020 Training equipment 2,000 Furniture and fittings 5,000 Prepaid insurance 5,200 Rental expense 60,000 Insurance expense 5,400 Membership fee received 141,690 General expenses 4,072 Wages and salaries 39,880 Equipment maintenance expense 6,100 Interest and bank charges 88 Allowance for doubtful debts 156 Accounts receivable 6,000 Accounts payable 4,500 Bank 86,044 252.940 252.940 The following additional information all of which is considered material and (unless stated otherwise) none of which has been taken into consideration in arriving at the figures shown in the trial balance above is listed below: On 1 October 2021, Arun sold a training equipment costing $1,600, with accumulated depreciation of $150 as at 31 Dec 2020 for cash of $600. Arun deposited the cash into his personal bank account. Arun has also forgotten to inform his accountant of this transaction. Both the cost and the accumulated depreciation of the training equipment sold were included in the amount shown for training equipment at cost and the accumulated depreciation for training equipment in the unadjusted trial balance above. The residual value of the training equipment was originally estimated to be $100. Required: (a) Analyse the above information and prepare all necessary adjusting entries. Show narrations and all workings. (21 marks) (b) Present the following after taking into consideration all the adjustments in (a): (i) The net profit for the year ending 31 December 2021. (ii) The total assets as at 31 December 2021. (iii) The total liabilities as at 31 December 2021. (iv) The total equity as at 31 December 2021. (19 marks)