Exercise 11-2A (Algo) Effect of accounting events on the financial statements of a sole proprietorship LO...

Transcribed Image Text:

Exercise 11-2A (Algo) Effect of accounting events on the financial statements of a sole proprietorship LO 11-1 A sole proprietorship was started on January 1, Year 1, when it received $48,000 cash from Marlin Jones, the owner. During Year 1, the company earned $42,700 in cash revenues and paid $19,560 in cash expenses. Jones withdrew $5,600 cash from the business during Year 1. Required Prepare an income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows for Jones's Year 1 fiscal year. Note: For Statement of Cash Flows only, Indicate amounts to be deducted and cash outflows with a minus sign. Answer is complete and correct. MARLIN JONES SOLE PROPRIETORSHIP Income Statement For the Year Ended December 31, Year 1 Revenues Expenses Net income $ 42,700 19,580 $ 23,140 Answer is not complete. MARLIN JONES SOLE PROPRIETORSHIP Capital Statement For the Year Ended December 31, Year 1 Beginning capital balance Plus: Capital acquired from owner Plus: Net income 23,140 Ending capital balance $ 23,140 Assets Cash Answer is complete and correct. MARLIN JONES SOLE PROPRIETORSHIP Balance Sheet As of December 31, Year 1 $ 65,540 Total assets Liabilities Equity Jones, Capital $ 65,540 65,540 Total liabilities and equity $ 65,540 Answer is not complete. MARLIN JONES SOLE PROPRIETORSHIP Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: Receipts from revenues Paid for expenses Net cash flow from operating activities Cash flows from investing activities S 0 Net cash flow from investing activities S 0 Cash flows from financing activities Proceeds from owner Paid for owner withdrawals Net cash flow from financing activities Net change in cash Plus: Beginning cash balance Ending cash balance 0 0 S 0 Exercise 11-2A (Algo) Effect of accounting events on the financial statements of a sole proprietorship LO 11-1 A sole proprietorship was started on January 1, Year 1, when it received $48,000 cash from Marlin Jones, the owner. During Year 1, the company earned $42,700 in cash revenues and paid $19,560 in cash expenses. Jones withdrew $5,600 cash from the business during Year 1. Required Prepare an income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows for Jones's Year 1 fiscal year. Note: For Statement of Cash Flows only, Indicate amounts to be deducted and cash outflows with a minus sign. Answer is complete and correct. MARLIN JONES SOLE PROPRIETORSHIP Income Statement For the Year Ended December 31, Year 1 Revenues Expenses Net income $ 42,700 19,580 $ 23,140 Answer is not complete. MARLIN JONES SOLE PROPRIETORSHIP Capital Statement For the Year Ended December 31, Year 1 Beginning capital balance Plus: Capital acquired from owner Plus: Net income 23,140 Ending capital balance $ 23,140 Assets Cash Answer is complete and correct. MARLIN JONES SOLE PROPRIETORSHIP Balance Sheet As of December 31, Year 1 $ 65,540 Total assets Liabilities Equity Jones, Capital $ 65,540 65,540 Total liabilities and equity $ 65,540 Answer is not complete. MARLIN JONES SOLE PROPRIETORSHIP Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: Receipts from revenues Paid for expenses Net cash flow from operating activities Cash flows from investing activities S 0 Net cash flow from investing activities S 0 Cash flows from financing activities Proceeds from owner Paid for owner withdrawals Net cash flow from financing activities Net change in cash Plus: Beginning cash balance Ending cash balance 0 0 S 0