Accounting question help please :)

Answer all questions in the Excel Workbook

Question 1 (11 marks)

Cover Up is a business that specialises in customised spare wheel and car covers. At 30 June 2023 the accountant prepared the following Pre-adjusted Trial Balance (extract):

Additional information:

I Wages owing $4 850.

• Rent is paid six months in advance twice a year, a payment of $27 000 was made on 1 April 2023.
• The Term Deposit was taken out on 1 Feb 2023. Interest is earned at 5% per annum and is paid every 6 months on 1 August and 1 February each year.
• 75% of sales were on credit
• The owner has decided to establish an Allowance for Doubtful Debts and has determined that 3% of net sales are unlikely to be collected.
• The business prepares reports annually.

a.

Prepare the General Journal adjusting entries for 30 June 2023. Narrations are not required.

b.

8 marks

Referring to a qualitative characteristic and using an example from the information above, explain the importance of preparing balance adjustments.

3 marks

\begin{tabular}{|l|r|r|} \hline Account & Debit \$ & \multicolumn{1}{|c|}{ Credit \$ } \\ \hline Loan-Southern Finance & & 20000 \\ \hline Van & 35000 & \\ \hline Accumulated Depreciation - Van & & 8500 \\ \hline Advertising & 10900 & \\ \hline Accounts Receivable & 42000 & \\ \hline Drawings & 18900 & \\ \hline Sales & & 385000 \\ \hline Prepaid Rent Expense & 39000 & \\ \hline Term Deposit & 36000 & \\ \hline Wages & 92830 & \\ \hline Inventory & 58600 & \\ \hline Sales Return & 13750 & \\ \hline \end{tabular}