California Mining began operations by issuing common stock for \(\$ 100,000\). The company paid \(\$ 90,000\) cash in advance for a one-year contract to lease machinery for the business. The lease agreement was signed on March 1, 2011, and was effective immediately. California Mining received \(\$ 115,000\) of cash revenue in 2011.
Required

a. Record the March 1 cash payment in general journal format.

b. Record in general journal format the adjustment required as of December 31, 2011.

c. Record all 2011 events in a horizontal statements model like the following one:

d. What amount of net income would California Mining report on the 2011 income statement? What is the amount of net cash flow from operating activities for 2011 ?

e. Determine the amount of prepaid rent California Mining would report on the December 31, 2011, balance sheet.

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Assets = Liab. + Equity Rev. Exp. = Net Inc. Cash Flow Ret. Earn. Cash Prep. Rent =