Malco Enterprises issued $10,000 of common stock when the company was started. In addition, Malco borrowed $36,000

Question:

Malco Enterprises issued $10,000 of common stock when the company was started. In addition, Malco borrowed $36,000 from a local bank on July 1, 2016. The note had a 6 percent annual interest rate and a one-year term to maturity. Malco Enterprises recognized $72,500 of revenue on account in 2016 and $85,200 of revenue on account in 2017. Cash collections of accounts receivable were $61,300 in 2016 and $71,500 in 2017. Malco paid $39,000 of other operating expenses in 2016 and $45,000 of other operating expenses in 2017. Malco repaid the loan and interest at the maturity date.

Required

Based on this information, answer the following questions.

a. What amount of interest expense would Malco report on the 2016 income statement?

b. What amount of net cash flow from operating activities would Malco report on the 2016 statement of cash flows?

c. What amount of total liabilities would Malco report on the December 31, 2016, balance sheet?

d. What amount of retained earnings would Malco report on the December 31, 2016, balance sheet?

e. What amount of net cash flow from financing activities would Malco report on the 2016 statement of cash flows?

f. What amount of interest expense would Malco report on the 2017 income statement?

g. What amount of net cash flow from operating activities would Malco report on the 2017 statement of cash flows?

h. What amount of total assets would Malco report on the December 31, 2017, balance sheet?

i. What amount of net cash flow from investing activities would Malco report on the 2017 statement of cash flows?

j. If Malco Enterprises paid a $2,000 dividend during 2017, what retained earnings balance would it report on the December 31, 2017, balance sheet?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...