This the new business started in January. The following transactions are done by the business in the month of January. Assumption: The Cost of goods sold is 80% of the sales revenue Jan 1 Owner started firm by depositing $30,000 into a bank account 2 Bought Equipment on credit from John & son $6,800 2 Repair shop fittings, paid by cheque $1200 3 Bought Merchandise on credit from suppliers for $5,600 4 Paid rent by cheque for 3 month $480 in advance 5 Received loan of $600 in cash from King Kong 5 Sold merchandise on credit to a Customers as follows $2800 6 Bought office equipment on credit from Arthur & Associates $1480 7 Cash sale $520 8 Paid wages in cash $180 9 Bought office stationary for cash $560 11 Sold Merchandise on credit to customers for $390 12 Returned merchandise to suppliers worth $230 13 Paid John & son $6,800 by cheque 14 Bought office stationery on credit $300 15 Bought Merchandise on credit for $2160 16 Merchandise returned $112 17 Paid for credit merchandise purchases $2700 by cheque 19 Repaid part of King Kong's loan by cheque $240 20 Cheques received from $850 for credit sales 21 Owner took $200 drawings in cash 28 Bought Merchandise for cash $180 30 Paid to suppliers for the merchandise purchased on credit by cheque $800.

Adjustments:

31 Unpaid Salary to an employee $240

31 Advance rent for the month i.e., $160 is availed

31 Depreciation is charged at the rate of 20% on the value of Equipment

31 It was estimated that a $220 is consumed during the month.

Perform the following activities:

Perform the following activities:

Question 1

Prepare General Journal for transaction excluding Adjustments, will done later. (Marks 25%)

Question 2

General Journal prepared in question 1 to be posted to relevant ledgers. (Marks 25%)

Question 3

Using ledgers posted in question 2, prepare Trial Balance (Marks 15%)

Question 4

Prepare General Journal for Adjustments (Marks 5%)

Question 5

Post General Journal prepared in question 4 to Adjustments and Adjusted Trial Balance (Marks 10%)

Question 6

Using Adjusted Trial Balance prepared in question 5, prepare Income Statement (Marks 10%)

Question 7

Using Adjusted Trial Balance prepared in question 5, Prepare Balance Sheet (Marks 10%)