Quiz Practice Problem Workplace Safety Group (WSG) is a newly established company which started its operations in Kamloops; BC on July 1", 2022. The company was founded by Monica and Phoebe. Monica is a software engineer while Phoebe has bachelor's ln occupational health and safety. The company operates in a hybrid model where some safety courses are offered online, and some are in person. The business model is to sell safety courses to companies which need their employees to go through safety training programs either before they could start with the company or during the course of their employment. It is February 2023 and one day while dellvering Pizzas to WSG, Monica asked you whether you go to school and what are you taking at TRU. You tell her you are a business student. She further asks if you know anything about accounting. You recently took Intro accounting course, so you tell her that you know some fundarnentals of accounting. She tips you $10 and says, if you are looking to make some extra cash on top of this pizza delivery. please stop by tomorrow. We are a new business and can use your help. You decide to stop by next day, which is February 5,, 2023, and go into the office which is on Victoria Street. Monica and Phoebe welcome you and you head to the meeting room. Here is how the conversation goes: "Thank you so much for stopping by. You know we are a new business and could not afford hiring a CPA to set our financial records straight. We started this business in July and its going great. However, we needed some more cash in-flow, and another investor is ready to invest but they asked to see our financial resuits as of January 31 , 2023 So far, we are managing the financials ourselves. We thought it would be simple. Cash that we receive from our customers is our revenue and cash that we spend to run our operations is our expenses. But the investor says they Want to see financial statements and that too prepared under accrual method of accounting. We are hoping you are able to help us with that. Below is some data that we anticipated might be of help to you while preparing our financial statements. We have not done any lournal entries whatsoever as we were confused about debits and credits. Operations began on July 17, 2022. Me and Monica put down $50,000 into the business and 5,000 common shares were issued to each of us. We bought office equipment such as desks and chairs for $10,000 and they will be good for 5 years and after that they will have no value. The bill for desks and chairs has been paid. We also bought 4P laptops for $5,000 and that purchase was made on cash. Monica says, in my experience, laptops will last for a maximum 3 -years and will then become obsolete. We rented this place from our common friend Rachel for an initial lease period of one year, Annual rent is 512,000 and we paid it upftont. Lease period is trom July 114,2022, to June 30,2023 . January will be paid on February 67, 2023. We also bought some office supplies at the start on July 15t for 51,500. We paid cash. Phoebe adds. "oh that reminds me to order some new supplies as soon as possible. I went to supplies storeroom to get a few supplies on January 31H and saw that we are totally out all our supplies. Monica further tells you that business got a $10,000 loan from Phoebe's friend Joey on September 1tt,2022. We have to pay him back on July 1, 2023, and annual interest rate is 8%. Utilities such as electricity and waste removal cost us $200 each month. All bills up until December have been paid. We have not received a bill for electricity and waste removal for the month of January yet