Question B [AR1: 8 Marks]

Sun Company started its operations on January 1, 2019. The following transactions took place during the first month of operations:

January 1: Sun invests $4,600,000 cash to start the business.

January 3: Purchased furniture for $496,000, paying $96,000 in cash and sign a note for the remaining balance.

January 7: Purchased office supplies for $20,000 on credit.

January 11: Paid $44,000 cash for January rent.

January 15: Paid $5,400 cash for office supplies purchased on January 7.

January 20: Services billed to customers amount to $96,000.

January 22: Received utility bills for $10,500 for the month of January.

January 25: Paid $47,400 cash as salaries for the month.

January 29: Received $66,000 cash from customers in payment for services billed on January 20.

January 31: Sun withdrew $15,600 from the business for personal use.

Required:

1- Prepare Journal entries to record the above transactions. (2 marks)

2- Post to the appropriate ledger accounts. (2 marks)

3- Prepare the trial balance on January 31 2019. (2 marks)

4. Prepare the financial statements of Sun Company on January 31 2019. (2 marks)