Question

Waddell Company had the following balances in its accounting records as of December 31, 2015:
The following accounting events apply to Waddell Company’s 2016 fiscal year:
Jan. 1 Acquired $20,000 cash from the issue of common stock.
Feb. 1 Paid $6,000 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 additional land that cost $15,000 cash.
May 1 Made a cash payment on accounts payable of $5,500.
July 1 Received $9,600 cash in advance as a retainer for services to be performed monthly over the coming year.
Sept. 1 Sold land for $30,000 cash that had originally cost $30,000.
Oct. 1 Purchased $2,500 of supplies on account.
Dec. 31 Earned $58,000 of service revenue on account during the year.
31 Received cash collections from accounts receivable amounting to $46,000.
31 Incurred other operating expenses on account during the year that amounted to $28,000.
31 Recognized accrued salaries expense of $6,500.
31 Had $50 of supplies on hand at the end of the period.
31 The land purchased on April 1 had a market value of $20,000.
31 Recognized $500 of accrued interest revenue.
Required
Based on the preceding information, answer the following questions for Waddell Company. All questions pertain to the 2016 financial statements.
a. Based on the preceding transactions, identify two additional adjustments and describe them.
b. What amount would Waddell report for land on the balance sheet?
c. What amount of net cash flow from operating activities would be reported on the statement of cash flows?
d. What amount of rent expense would be reported on the income statement?
e. What amount of total liabilities would be reported on the balance sheet?
f. What amount of supplies expense would be reported on the income statement?
g. What amount of unearned revenue would be reported on the balance sheet?
h. What amount of net cash flow from investing activities would be reported on the statement of cash flows?
i. What amount of total expenses would be reported on the income statement?
j. What amount of service revenue would be reported on the income statement?
k. What amount of cash flows from financing activities would be reported on the statement of cash flows?
l. What amount of net income would be reported on the income statement?
m. What amount of retained earnings would be reported on the balance sheet?


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  • CreatedApril 20, 2015
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