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(Answer all the Questions) Q. 1. When today's university students are asked about their long-term career choice, a surprisingly large number respond that they wish to someday own and manage their own business. In fact, the aspiration to start a business, to be an entrepreneur, is nearly universal. It is widely acknowledged that a degree in accounting offers many advantages to be an entrepreneur. In fact, if you ask owners of small businesses which skill they wish they had more expertise in, they will very frequently reply "accounting". No matter what the business may be the owner and/or manager must be able to understand the accounting and financial consequences of business decisions. Required: Do you agree with this view? Why or why not? Explain Marks: 5 Q. 2. Barone's Repair Shop was started on May 1 by Nancy Barone. A summary of May transactions is presented below. 1. Invested $10,000 cash to start the repair shop. 2. Purchased equipment for $5,000 cash. 3. Paid $400 cash for May office rent. 4. Paid $500 cash for supplies 5. Incurred $250 of advertising costs in the Beacon News on account 6. Received $5,100 in cash from customers for repair service. 7. Withdrew $1,000 cash for personal use. 8. Paid part-time employee salaries 52,000. 9. Paid utility bills $140 10. Provided repair service on account to customers $750. 11. Collected cash of $120 for services billed in transaction (10). Required: (a) Prepare a tabular analysis of the transactions, using the following column headings: Cash, Accounts Receivable, Supplies, Equipment, Accounts Payable, N. Barone, Capital: N. Barone, Drawings: Revenues, and Expenses. Marks: 10 Q.3. Required: From the above analysis, compute the net income or net loss for May. Marks: 5

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