Smart Traders, is owned by Avanti Beharrie, opened its doors on 1 January 2019. The following transactions by the business took place during the first month of trading (ignore any VAT implications).

Day Details
1 The owner deposited R30 000 cash into the business bank account.
4 Withdrew R4 500 from the business account for petty cash.
6 Purchased an initial range of inventory for R20 000, and paid for the goods by EFT.
8 Bought a cash register and display shelves on credit for R4 800, less 10% trade discount.
11 Bought an advert in an online marketplace, and paid R600 by EFT.
11 Sold inventory to Mr Smith on credit for R5 600. The original cost of these goods was R3 570.
15 Paid R80 for stationery, from petty cash.
18 The owner broke an item from inventory while reorganising a shop window display. The original cost price of the article was R1 100, but it would have sold for R1 700.
20 Bought cleaning materials with petty cash – R210.
24 Made sales of R10 240 cash. These items had been marked up by 60% on cost.
27 Paid the store assistant’s salary of R4 800 by EFT.
29 Made a large sale (on credit) of R14 725. These goods had a markup of 55%.
30 Received R1 400 from Mr Smith as a part-payment against his account.
31 Paid casual wages of R1 600 with cash.
1.1 Calculate the owner’s equity in the business on 31 January by showing the effect of each individual transaction on the accounting equation in the table below (using + and – signs in each row). Where effects set off against each other in the same column, be sure to show both effects in separate rows, regardless. (20 marks)
Day Assets Owner’s equity Liabilities
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Total

1.2 Has Avanti created wealth for herself or lost money in the first month of trading? Either way, how much? (3 marks)
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1.3 Would she be happy with this result? Give a reason in a brief point. (2 marks)
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1.4 To the nearest percentage, what was the markup on cost on the goods sold to Mr Smith on the 11th? (5 marks)
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