Adam set up a business and in the first nine days of trading the

following transactions occurred:

(1)January

Adam introduces $10,000 capital by cash.

(2)January

Adam buys supplies worth $4,000 and pays by cash.

(3)January

Adam buys a delivery van for $2,000 and pays by cash.

(4)January

Adam buys $1,000 of purchases on credit.

(5)January

Adam sells goods for $1,500 and receives a cash of that

amount.

(6)January

Adam sells all his remaining goods for $5,000 on credit.

(7)January

Adam pays to his supplier payable of $800 by cash.

(8)January

Adam pays rent of $200 by cash.

(9)January

Adam draws $100 for living expenses from the business

bank account.

There is no closing stock. Both Supplies and Purchases will be accounted for as

inventory for sale

Required:

(a)Write double entries of the given transactions

(b) Complete the relevant ledger accounts.

(c) Extract a trial balance.

(d) Prepare the income statement for the first nine days.

(e) Prepare the Statement of financial position as at 9 January.

Answer rating: 100% (QA)

Lets start with the double entries for the transactions 1 Adam introduces 10000 capital ... View the full answer