John Phelps has run a small business for many years and has never kept adequate accounting records. However, a need to obtain a loan from the Bank of Make It Flow, for the expansion of his business has necesitated the preparation of final accounts. As such, he has contracted a medium size accounting firm. WAD & Associates to assist him in preparing a full set of accouting reconds. You were recently employed to WAD & Associates and have been assigned the task to prepare the final accounts for John Phelps. You were able to ascertain the following information for the year ended December 31, 2020: 1. John Phelps' bank transactions for the year Jamuary 1 trough December 31, 2020 were as follows: Bank Account Receipts Payments 430,100 Trade payables Trade receivables 272,500 Debit card 40,000 Electricity 4,500 Rates and rent 23,600 Loan principal 25,000 Drawings 1,250 Computer oquigment 150,000 Overdraft interest 750 Salaries & wages 26.000 Accounting fee 7,500 470,100 S11,100 2. The bank account had a favourable halance on December 31, 2020 of S47,900 before considering Note 3(e) and Note 6 below. 3. During the year. a. Discounts allowed by trade payables amounted so S1350 and allowed to trade receivables amounted $1,840. b. The financial year goods retumed by trade receivables amounted to S1,600 and goods retumed to trade payables amounted to S6,900. e. The financial year a trade debt of S1.200 owed by Lomie Graham was off-set against the S2.000 owing to the same Lotie Graham a trade creditor. d A customer, Janet Hutton bought goods asing a debit card. She returned goods amounting to S700 and was repaid from the Debit Card takings before applying the commission (see mote Na. 7 goods amounting to S700 and was repaid from the Debir Cand takings before applying the commission (see note Na 7 e. John Phelps puts a further $135,000 into the hank account of the business to shore up working capital. This is not yet reflectod in the bank balance. 4. The closing trade receivables include S750 in respect of a bad debe that should be written off. 5. The computer equipment was purchased on April 9, 2020. Depreciation should be calculated on the computer oquipment on the straighe line basis at a rate of 20% per annum on cost. It is the policy of the business to charge a full month's depreciation in the month of acquisition or disposal. 6. On April 1, 2020 John Phelps" received a loan of S75,000 from his mother. Interest should be charged on the reducing balance at a rate of 10% per annum. The first interest pay ment is to be made on March 31, 2021. The principal is being paid in oqual instalments of $25,000 commencing on September 30. 2020, September 30, 2021 and September 30, 2022. laterest on loan was outstanding at December 31, 2020. 7. For some of the sales debit cards are accepted. John Phelps pays 2.5% debit card commission on gross debit card sales. 8. The balances at the end of cach year are as follows: December 31, 2019 December 31, 2020 Inventory 41,000 48,500 Trade receivables 29.300 35,750 Prepaid rent S00 600 Fixtures (net) 20,000 19,000 Trade payables 19.500 19,000 Debit card receivables 1325 750 Required: a. Prepare the Statement of Affairs as at January 1, 2020 (10 marks) b. Prepare the Trade Receivables Control Account (35 marks) c. Prepare the Trade Payables Control Accounts. (7 marks) a. Prepare the Statement of Affairs as at January 1, 2020 (10 marks) b. Prepare the Trade Receivables Control Account. (3.5 marks) c. Prepare the Trade Payables Control Accounts. (7 marks) d. Prepare the Debit Card Receivables Account (2.5 marks) e. Prepare the Income Statement for the year ended December 31, 2020. (25 marks) f. Prepare the Statement of changes in owner's equity for the year ended December 31, 2020 (7 marks) g. Prepare comparatively the Statement of Financial Position as at the year ended December 31. 2020 (25 marks) h. Prepare a Statement of Cashflow for the ended December 31, 2020. (20 marks)