Question

Porser Company had the following balances in its accounting records as of December 31, 2013:


The following accounting events apply to Porser Company’s 2014 fiscal year:
Jan. 1 Acquired $15,000 cash from the issue of common stock.
1 Purchased a truck that cost $22,000 and had a $2,000 salvage value and a four-year useful life.
Feb. 1 Borrowed $12,000 by issuing a note that had a 9 percent annual interest rate and a one-year term.
1 Paid $3,000 cash in advance for a one-year lease for office space.
Mar. 1 Paid a $2,000 cash dividend to the stockholders.
April 1 Purchased land that cost $28,000 cash.
May 1 Made a cash payment on accounts payable of $4,000.
July 1 Received $5,400 cash in advance as a retainer for services to be performed monthly over the next 12 months.
Sept. 1 Sold land for $42,000 that originally cost $42,000.
Oct. 1 Purchased $5,000 of supplies on account.
Nov. 1 Purchased a one-year $50,000 certificate of deposit that paid a 6 percent annual rate of interest.
Dec. 31 Earned $42,000 of service revenue on account during the year.
31 Received cash collections from accounts receivable amounting to $40,000.
31 Incurred other operating expenses on account during the year that amounted to
$6,000.
31 Incurred accrued salaries expense of $5,200.
31 Had $200 of supplies on hand at the end of the period.


Required
Based on the preceding information, answer the following questions. All questions pertain to the 2014 financial statements.
a. Based on the preceding transaction, identify five additional adjustments and describe them.
b. What amount of interest expense would Porser report on the income statement?
c. What amount of net cash flow from operating activities would Porser report on the statement of cash flows?
d. What amount of rent expense would Porser report in the income statement?
e. What amount of total liabilities would Porser report on the balance sheet?
f. What amount of supplies expense would Porser report on the income statement?
g. What amount of unearned revenue would Porser report on the balance sheet?
h. What amount of net cash flow from investing activities would Porser report on the statement of cash flows?
i. What amount of interest payable would Porser report on the balance sheet?
j. What amount of total expenses would Porser report on the income statement?
k. What amount of retained earnings would Porser report on the balance sheet?
l. What amount of service revenues would Porser report on the income statement?
m. What amount of cash flows from financing activities would Porser report on the statement of cash flows?
n. What amount of net income would Porser report on the incomestatement?


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  • CreatedOctober 12, 2013
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