Question

Pearson Enterprises started the 2016 accounting period with $75,000 of assets (all cash), $15,000 of liabilities, and $25,000 of common stock. During the year, Pearson earned cash revenues of $46,000, paid cash expenses of $26,000, and paid a cash dividend to stockholders of $5,000. Pearson also acquired $15,000 of additional cash from the sale of common stock and paid $10,000 cash to reduce the liability owed to a bank.
Required
a. Prepare an income statement, statement of changes in stockholders’ equity, period-end balance sheet, and statement of cash flows for the 2016 accounting period.
b. Determine the percentage of total assets that were provided by creditors, investors, and earnings.
c. Determine the balance in the Revenue, Expense, and Dividends accounts as of January 1, 2017.


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  • CreatedApril 20, 2015
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