Wilmot Real Estate Company experienced the following events during its first year of operations:
1. Received \($50,000\) in cash from investors as an equity investment.
2. Borrowed \($40,000\) in cash from a bank.
3. Purchased two parcels of land, each costing \($15,000\), for a total of \($30,000\) cash. The land was purchased for investment purposes.
4. Paid \($10,000\) cash to rent office equipment for the year.
5. Provided real estate appraisal services valued at \($25,000\), receiving \($20,000\) in cash and an account receivable for an additional \($5,000\).
6. Paid miscellaneous expenses totaling \($11,000\) in cash.
7. Sold one parcel of land, costing \($15,000\), for \($22,000\) cash.
8. Paid a \($5,000\) cash dividend to shareholders.
Required:

Using the balance sheet equation as illustrated in this chapter, identify how each of the above events affect the balance sheet equation of A = L + SE. Prepare an income statement, a statement of shareholders’ equity, a balance sheet, and a statement of cash flow for the first year of operations. Evaluate the company’s financial performance during its first year of operations.