Anita Mir started a business running a boutique clothing store on 1 January 2019. On that...

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Anita Mir started a business running a boutique clothing store on 1 January 2019. On that date she paid 25,000, which she had inherited from her grandma, into the business bank account and took out a bank loan of 70,000 which was also paid into the business bank account. The interest on the bank loan is at a fixed rate of 8% which has to be paid monthly in arrears (i.e. on the last day of each month). On 1 January 2019, Anita paid 21,000 cash for some fixtures and fittings for her shop which she expects to last for about 5 years; she also paid 14,000 for some clothes and accessories which she plans to sell in her boutique. The store opened for customers on 2 January 2019. Required: Record the above transactions using accounting equation and Prepare a balance sheet (statement of financial position) for Anita's business at the end of 1 January 2019. Anita Mir started a business running a boutique clothing store on 1 January 2019. On that date she paid 25,000, which she had inherited from her grandma, into the business bank account and took out a bank loan of 70,000 which was also paid into the business bank account. The interest on the bank loan is at a fixed rate of 8% which has to be paid monthly in arrears (i.e. on the last day of each month). On 1 January 2019, Anita paid 21,000 cash for some fixtures and fittings for her shop which she expects to last for about 5 years; she also paid 14,000 for some clothes and accessories which she plans to sell in her boutique. The store opened for customers on 2 January 2019. Required: Record the above transactions using accounting equation and Prepare a balance sheet (statement of financial position) for Anita's business at the end of 1 January 2019.

Answer rating: 100% (QA)

Recording the transactions using the accounting equation 1 Initial investment Assets Cash ... View the full answer