Question 5 (7 marks)

The accountant of Paul Shop Fitter Private Limited has provided the following data on the Assets, Liabilities, Equity, Income and Expense amounts as at 30th June 2021.

	$		$
Equipment	221,800	Supplies	84,200
Prepaid Insurance	24,000	Cash in Bank	88,400
Accounts receivable	182,800	Accounts payable	101,100
Capital	?	Bank loan	30,000
Service income	1,158,000	Salary expense	483,000
Advertising expense	15,000	Supplies expense	142,500

Required:

1. Prepare a Balance Sheet in the narrative (vertical) format as at 30^th June 2021. (5 marks)
2. Explain what key information the Balance Sheet provides to users of the financial statements. (2 marks)