Reference no: EM131518886

Question: The following transactions occurred during the first month of operations for ‘Oz Hinterland', a hotel proprietor's new business located in the Australian Kimberleys:

a Owner invested $80,000 of her own money in Oz Hinterland.

b In order to provide further capital, a bank extended a loan of $40,000 for the business.

c Paid cash for land and buildings $99,500.

d Purchased kitchen equipment for $20,000. $8,000 of this was paid for in cash, with the balance owing. e Purchased on credit a stock of linen and uniforms for $5,800.

f During month received revenue of $12,000 for room sales and restaurant revenue.

g Paid $1,500 for first month's wages.

h Paid $300 covering one month's interest on the bank loan.

i Paid $1,200 insurance premium covering the first year of operations.

j Paid $6,000 of the balance owing for kitchen equipment.

k Purchased beverage stock of $1,500 for cash. By the end of the first month it was determined that one third of this stock had been sold in the restaurant.

l Determined that during the month the kitchen had purchased $1,800 of perishable food supplies for cash. No balance of food stock remained at the end of the month.