Question: The following transactions apply to Brooks Co for 2014 its

The following transactions apply to Brooks Co. for 2014, its first year of operations.
1. Issued $60,000 of common stock for cash.
2. Provided $74,000 of services on account.
3. Collected $62,000 cash from accounts receivable.
4. Loaned $15,000 to Horne Co. on October 1, 2014. The note had a one-year term to maturity and an 8 percent interest rate.
5. Paid $47,000 of salaries expense for the year.
6. Paid a $2,500 dividend to the stockholders.
7. Recorded the accrued interest on December 31, 2014 (see item 4).
8. Uncollectible accounts expense is estimated to be 1 percent of service revenue on account.

a. Show the effects of the above transactions in a horizontal statements model like the one shown below.

b. Prepare the income statement, balance sheet, and statement of cash flows for2014.\
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  • CreatedMay 22, 2014
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