After a number of years as a successful doctor at a national firm, you decide to quit

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Question:

After a number of years as a successful doctor at a national firm, you decide to quit the rat race and pursue your true love - yoga. You decide that your neighborhood would be the perfect place to open a yoga studio. Even better, your friend Roxy, a certified yoga instructor, has just moved to town and is willing to teach at the studio. You hurriedly prepare to open the studio, North Sydney Yoga, by Jan 1, 2022.

In preparation for your opening, you engage in the following transactions on Jan 1, 2022:

1. You contribute $20,000 in cash to start the business.

2. You purchase $5,000 worth of equipment for use during classes for cash.

3. You purchase an additional $1,000 worth of yoga mats and clothing for sale at the studio, for cash.

4. You purchase liability insurance at a total cost of $1,500. The policy covers Jan 1, 2022 through to December 31, 2022.

The following transactions took place during Jan 2022

Date	Transaction
Jan 5	You collected $3,500 in total from new members as membership fees for Jan 2022 in cash.
15	Roxy, the yoga instructor is paid $1,500 as salary for Jan 2022.
20	Rent is paid for the month of Jan 2022 in cash $3,000.
30	You received the bills for electricity $150 and telephone $80 for the month of Jan. This will be paid on Feb 15, 2022.

The following transactions took place during Feb 2022

Date	Transaction
Feb 5	You collected $3,500 in total from members as membership fees in cash. Of this amount, $1,500 is for classes that members will attend in Feb and $2,000 is for classes that they will attend in March 2022.
15	Roxy, the yoga instructor earns $1,500 for teaching yoga classes in Feb 2022. Of this amount, $500 is paid on Feb 15, 2022 and the remaining $1,000 will be paid on March 15, 2022.
17	Sold yoga mats for $500 in cash. The cost of the mats sold is $300.
19	You were running low on cash, so you borrowed $10,000 in cash from your local bank. This loan will have to be repaid after 3 years.
20	Rent is paid for the month of Feb 2022 in cash $3,000.
25	A client who had paid $100 for yoga classes in Feb was very dissatisfied with her classes. She wanted a refund. You agreed to refund the $100 paid by the client.
28	You received the bills for electricity $260 and telephone $100 for the month of Feb. This will be paid on March 15, 2022.
28	You withdrew $1,500 of your investment from the business to pay for your personal expenses.