Reference no: EM132776217

Question - L&T is a company specialized in selling Phones. Its first month of operation is January 2016 in which the following transactions were undertaken

Jan 1: issue capital stock of £330,000in cash

Jan 2: Borrowed £230,000 from the bank at an annual interest rate of 5.5%

Jan 3: Purchased 100 Phones at £500 per Phone

Jan 4: Purchased Building at £60,000. The company paid £25,000 and agreed to pay the rest on a note payable

Jan 8: Paid rent for the month of January at £1650

Jan 15: Received investment of £160,000 from the owners

Jan 20: Sold 47 phones at £1150 each

Jan 24: Purchased Furniture at £27,000. The company paid £12000 and agreed to pay the rest on account

Jan 27: Paid salaries at £5000

Jan 29: Paid one month of interest

Jan 30: Paid dividends of £900

Jan 31: Paid income taxes at 11.3%

Required - Preparation of a proper Income Statement and Balance sheet for L&T?