The Johnson Drafting Company was started on 1 March to draw blueprints for building contractors. The following transactions of the company occurred during March:

Required:
i Using the accounting system shown in the chapter, record the preceding transactions.
ii Prove the equality of the accounting equation at the end of March.
iii Calculate the net income of the company for March.
iv Prepare a balance sheet for the company on 31 March.

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Date 1/3 2/3 3/3 8/3 15/3 28/3 29/3 30/3 30/3 31/3 Transactions M. Johnson, the owner, started the business by investing $14 000 cash. Land and a small office building were purchased at a cost of $4400 and $22 000, respectively including GST. A down payment of $8000 was made, and a loan for $18 400 was signed. The loan is due in one year. Cash of $4840 (including GST) was paid to purchase computer drafting equipment. Drafting supplies totalling $880 (including GST) were purchased on credit. The amount is due in early April. The company collected $1500 (excluding GST) from contractors for drafting services performed. M. Johnson withdrew $1000 for personal use. The company received a $110 (including GST) utility bill for March, to be paid in April. The company paid $7600 in salary to a drafting employee. PAYG Tax payable included in this amount was $420. The company billed contractors $2200 (including GST) for drafting services performed during the last half of March. The company recorded the following adjustments: a Depreciation of $80 on the office building b Depreciation of $100 on computer drafting equipment c Interest of $160 on loan payable d Drafting supplies used of $150.