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The Byte of Accounting Corporation (Byte) sells turn-key computer systems to midsize businesses on account. Byte was started by Lauryn on January 1 of last year when she was issued 2,200 shares of stock. Business Operations: Clients' orders are drop shipped directly from the suppliers to the client's location. Upon delivery of the hardware, Byte is notified and Byte's employees install, modify and test the new items. Significant Accounting Policies: The business has adopted the following accounting policies: - Items that cost less than $2,000.00 are expensed. - Inventory is valued using a perpetual inventory system. - Specific identification is used to determine the cost of computers sold since the units are drop shipped directly to the clients. In response to customers, Byte will now start to inventory and install Super Toners at our clients' locations. - Perpetual FIFO will be used for the Super Toners. The allowance method is used to account for bad debts. Rent payments are expensed in the period in which they are incurred. When calculating depreciation, assets purchased during a month are treated as if purchased on the first day of the month. December 1:-_ a new investor, made an investment in Byte by purchasing 2,700 01. shares of its common stock paying $108,054.00 in cash. The par value of the common stock was $.02 per share. December 3: Byte purchased a Ricoh Color Copier for $5,000.00. The invoice number was 61298 . 02. Byte paid 10% in cash and signed a three-year note for the remaining balance. Interest at a rate of 6% a year will be paid semiannually. Description of transaction Transaction December 3: Check \# 6001 for $2,700.00 was issued by Byte to pay for rent of the office space for 03. December. 04. December 3: Byte received 12 Super Toners for resale to customers at a cost of $23.00 per toner. The invoice number was 7249 , and requires payment within 30 days. 05. December 10: Byte sold 4 Super Toners to a customer on account for $53.00 each. The Sales order number was 12100. 06. December 10: Byte records the cost of the 4 Super Toners sold using FIFO. The sales order number was 12100 . 07. December 11: Check \# 6002 was issued to pay salaries of $2,000.00 to equipment operators. (Ignore payroll taxes at this time.) December 14: Check \# 6003 was issued to purchase a one-year insurance policy covering its 08. computer equipment. The cost of the insurance is $6,504.00 and paid to Seth's Insurance. The effective date of the policy was December 16 and the invoice number was 2387