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The balance date for this company is 30th June 2020. You are to record the effect of each transaction on the extended accounting equation for the year ending 30th June 2020 using the table on the next page (page 7). Your answer should include all workings, the name of the account, the amount, and +/-. The first example illustrates how you would record the answer on the table. 1 A. Borrowed $10,000 from BNZ. 1 1 a. Sold inventory for $40,000: 50 percent for cash and 50 percent on credit. The cost of the inventory was 40 percent of total sales. 1 11 b. The owner brought into the business the following on 1st April 2020: i. Cash $10,000 ii. Equipment $50,0001 1 c. Depreciate the equipment brought in by the owner at balance date using the straight-line method. The expected salvage value at the end of its useful life of 4 years is $5,000.1 d. Sold an old equipment for $2,000. The cost of the equipment was $20,000 and it has an accumulated depreciation to date of $17,000. 1 11 1 e. Electricity for June 2020 of $450 was paid on 3rd July 2020. 1 1 f. The owner withdrew the following from the business on 30th June 2020: i. Cash $4,000 ii. Inventory $6,000.1 1 g. Invested $8,000 at an interest rate of 3% with ANZ on 1st October 2019. The principal and the interest will be received on 30th September 2020. 1 1 h. Paid the six-monthly rent of $12,000 on 1st March 2020. 1 1 i. Received a deposit of $9,000 for work to commence on 5th August 2020. 1 j. Amount owing to the supplier was $40,000. The supplier granted a 15% discount if the amount was paid by 30th June 2020. The amount was paid on 29th June 2020 to take advantage of the discount. 1 Extended Accounting Equation: Asset + Expenses = Liabilities + Equity + Revenue | ASSET EXPENSES LIABILITIES EQUITY REVENUER Transaction No. A. Bank + 10,000 Loan +10,000 8 $ 8 8 8 a. $ $ $ 1 1 b. 51 1 & 11 1 C. 8 d. 8 8 $ $ 1 1 8 e. $ 8 8 8 8 1 11 $ f. 1 1 1 1 h. 8 8 8 11 1 8 8 8 1 1 $ j. 8 g 8 8 8 1 11 8 1

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