2020 PHS 3E POA EOY P1 Q1
1 Shane started a business, Sheng Yang Store on 1 May 2020. He carried out a number of transactions in the month of May 2020.
Additional information
1. The owner took out an office computer costing $2 100 for his son. This has not been recorded yet.
2. The net realisable value of the inventory was $47 930.
3. Interest expense of $200 was unpaid.
REQUIRED
a. State the accounting equation.
[1]
b. The following were some transactions in the month of May 2020. Analyse how the transactions would affect the elements in the accounting equation. May 1 transaction is shown as an example.
[12]
Date | ||||
May 1 | Shane transferred | Cash at bank +$15 000 | Capital +$15 000 | No effect |
May 6 | Sheng Yang Store bought furniture for office use, $8 000 on credit from Wood Forest. | |||
May 12 | Sheng Yang Store paid for insurance by cheque, $100. | |||
May 18 | Sheng Yang Store sold inventory costing $5 000 for $8 200 on credit to Sing Lee.
| |||
May 20 | Sing Lee returned goods sold to him at $400. These cost $280. |
[TOTAL 13]