Styles THE PROJECT Robert Palmer is a recent graduate from the University, and he decided to start a green grocery. selling produce, such as ground provisions, fruits, and vegetables from the farmers in his community in St. Mary. He plans to operate under the business name, Palmer's Green Grocery He decided to rent a shop from Mr. Frank Miller for $20,000 per month and hire one assistant, Timothy Grant, to help him in the store. He started operations after the Covid-19 lockdown in June. He has asked your project team to manage his accounts for him The following were his transactions for his first month of operations: June 1 ***Mr. Palmer opened a bank account at the National Commercial Bank with $100,000. June 2 ***He sourced a loan from the St. Mary Credit Union for $300,000. The funds were deposited to his NCB bank account, June 3 ***He paid ORC Electronics $25,000 with a cheque to set up his point of sale machine June 3 He paid Mr. Carl Lewis $15,000 with a cheque to set up fixtures and fitting (shelves) to display his produce June 3 ***He purchased an electronic scale from Advanced Digital Scales Ltd for $10,000 on credit with a commitment to pay on July 1, 2020. June 4 ***He paid Mr. Frank Miller $60,000 for rent by a bank transfer to Mr. Miller's bank account June 5 ***He withdrew $25,000 from his bank account to cover business expenses. Styles June 5 He paid Signs & Banners Ltd $6,000 using cash, for the sign to be placed outside of his Shop June 5 He received the following deliveries later in the day 1. ***100 lbs of sweet potato at $50 per lb from Mr. Campbell paying cash. 2. 6 bunches of bananas at $500 per bunch from Mr. Donald Marshall paying cash 3. 200 lbs of pineapple at $100 per lb from Ms. Marjorie Rose on credit 4. 100 lbs of string beans @ $35 per lb from Mr. Patrick Brown on credit June 5 He went into a contract with Kool 97 FM to advertise for the month of June. He made a deposit of $5,000 using a cheque. June 6 He bought stationery for his office at Practical Stationery Ltd usiag a cheque, $6,500. June 8 ***He opened for business and made $80,000 of cash sales on his first day. June 9 He received a call from Hotel Five Seasons about supolvine produce to the hotel on a regular basis. He signed a contract with them later that day and delivered $50,000 worth of produce on credit. June 11 By the end of the week he sold an additional $25,000 worth of produce for cash. June 12 He received the following deliveries 1. 50 lbs of lettuce from Mr. Donald Marshall on credit for $10,000. 2. 6 bunches of bananas at $500 per bunch from Mr. Donald Marshall on credit 3. 60 bags of oranges from True Joose on credit at $500 each 4. 100 lbs of string beans @ $35 per lb from Mr. Patrick Brown on credit June 12 ***He collect his swipe machine from NCB and recorded $12,000 of sales via debit and credit cards June 12 *** He lodged $45,000 cash to the business bank account. I June 12 Timothy received his first fortnight wages of $16,000, as cash. June 13 ***He retumed 12 bags of oranges to True Joose June 15 ***He received a cheque from Hotel Five Seasons net a 10% discount for paying before the month end June 16 He received a water bill for $3,800 which he paid by cash at Paymaster. June 17 ***His wife asked him to bring home produce for her in the amount of $5,500. June 19 Hotel Five Seasons ordered S80,000 of produce for delivery June 20 ***Some of the produce were damaged during delivery and the hotel retumed $7,000 worth of produce June 26 Timothy received his second fortnight wages as cash June 26 Mr. Palmer decided not to take his salary this month but has asked you to show it as owing June 30 ***For the remainder of the month, Mr. Palmer made cash sales of $60,000, debit/credit card sales of $28,500 and transferred cash of $90,000 to the bank. June 30 Mr. Palmer cleared all his outstanding balances owed to the produce suppliers using cheques REQUIRED: Section 1 - 50 marks a) Journalize the transactions for the month that are indicated by (***). Narrations are to be included. 1 (15 marks) b) Post the above transactions in the General ledger. (15 marks) c) Extract an unadjusted trial balance as at June 30, 2020. (10 marks) d) Mr. Palmer did accounts in his first year at University but does not remember all the accounting principles. He has asked you to explain the accruals concept using two examples from his transactions. [Word count minimum = 50) (5 marks) e) Mr Palmer wants you to explain the term "equity" and tell him what types of transactions will increase his equity and reduce his equity, giving one example of each. I [Word count minimum = 50) (5 marks) Section 2 - 50 marks At your first meeting, after submitting the unadjusted trial balance to Mr. Palmer, the following comments were made Styles Section 2 - 50 marks At your first meeting, after submitting the unadjusted trial balance to Mr. Palmer, the following comments were made: He has not yet registered with the Companies Office of Jamaica and is not sure whether he should register as a sole trader or as a partnership with two of the farmers who supply him with produce. All non-current assets are to be depreciated using the straight-line basis: The point of sale machine and the electronic scale are to be depreciated at a rate of 25% per annum. (Round to the nearest dollar) and the fixtures and fittings at a rate of 10% per annum. (Round to the nearest dollar) After working with Mr. Grant for one month, he thinks he should give him a 15% salary increase to help with his bus fare. The increase is to be effective June 1" Mr. Palmer has I ng 2 Title 1 Subtitle asked you to book this for the month of June and he promises to pay Mr. Grant the increase on his next fortnight payment. The bill from the Jamaica Public Service (JPS) was received on June 30th and showed electricity charges of $12,000, due for payment by July 14. He still owed Kool 97 FM $25,000 on his advertising slots for June. Mr. Palmer has set his own salary at $50,000 per month REQUIRED: f) Journalize the above adjusting entries. Note: when doing the adjusted T-accounts only the accounts that have been affected need to be done (10 marks) 8) Prepare a short report to Mr. Palmer explaining the benefits of forming a business as a sole trader and the benefits of forming a partnership, (5 marks) h) Prepare an adjusted trial balance (thi would include everything along with the adjusted balances) (10 marks) 1) Prepare the Statement of Profit or Loss and the Statement of Financial Position for the period under review. For use in the financial statements, closing stock amounts to $10,500 at the end of the month (25 marks) Note: Please read the requirements carefully and provide an answer to each separately