Refer to P1.6. For any item on the balance sheet determine whether it is a current asset, a long- term (noncurrent asset), a current liability, a long- term (noncurrent) liability, or an owners’ equity item.

Data from P.16.

For each of the following items (A– L), indicate on which financial statement you would expect to find it and briefly explain why. For one item, two answers will be needed.

1. Income statement

2. Statement of cash flows

3. Balance sheet

A. Service fees earned

B. Accumulated depreciation on equipment

C. Cost of sales

D. Cash balance at the end of the period

E. Accounts receivable

F. Accounts payable

G. Inventory

H. Cash received from customers

I. Depreciation expense

J. Equipment

K. Cash paid for equipment

L. Retained earnings