A bookshop ordered 1,000 copies of an introductory accounting textbook from a publisher on 7 January 2004. The books were delivered on 2 February at which time an invoice was sent requesting payment of EUR 32.50 per book. However, a 5 per cent discount was allowed if the publisher received payment by 16 February. The bookshop made the payment on 12 February and on 23 February, it returned 40 books to the publisher.

(a) Analyse the impact of the above transactions on the accounting equation from the point of view of the publisher.

(b) Suppose this was the only sales transaction in 2004. Prepare the revenue section of the publisher's income statement.