Accounting Event Analysis and Financial Statement Preparation Smith & Co. experienced the following six events in its first year of operations:

1. Shareholders contributed $12,000 cash.
2. Purchased land for $8,000 cash.
3. Borrowed $3,600 in cash from a bank.
4. Provided services for $3,200, which will be paid to Smith & Co. next year.
5. Paid $2,200 cash for miscellaneous operating expenses.
6. Paid a $200 cash dividend to shareholders.

Required (a) Using the balance sheet equation as illustrated in this chapter, identify how each of the above six events affected the various accounts involved. Prepare an (b) income statement, (c) a statement of shareholders' equity, (d) a balance sheet, and (e ) a statement of cash flow for the first year of operations. (a) Hint - Make sure to enter each expense item as a negative amount for this worksheet.

Smith & Co.
Transaction:	1	2	3	4	5	6	Balance sheet
Assets
Cash	Answer	Answer	Answer	Answer	Answer	Answer	Answer
Accounts receivable	Answer	Answer	Answer	Answer	Answer	Answer	Answer
Land	Answer	Answer	Answer	Answer	Answer	Answer	Answer
Total assets							Answer
Liabilities
Loan Payable	Answer	Answer	Answer	Answer	Answer	Answer	Answer
Total liabilities							Answer
Shareholders' equity
Common stock	Answer	Answer	Answer	Answer	Answer	Answer	Answer
Retained earnings							Answer
Revenue	Answer	Answer	Answer	Answer	Answer	Answer
Operating expense	Answer	Answer	Answer	Answer	Answer	Answer
Dividends	Answer	Answer	Answer	Answer	Answer	Answer
Total shareholders equity							Answer

(b) Do not use a negative sign with your answers below.

Smith & Co. Income Statement For Year 1
Revenue	Answer
Operating expenses	Answer
Net Income	Answer

(c)

Smith & Co. Statement of Stockholders Equity For Year 1
	Common Stock	Retained Earnings	Total
Beginning balance	Answer	Answer	Answer
Net income	Answer	Answer	Answer
Dividends(enter as negative)	Answer	Answer	Answer
Stock sales	Answer	Answer	Answer
Balance at year-end	Answer	Answer	Answer

(d)

Smith & Co. Balance Sheet At End of Year 1
Assets			Liabilities
Cash	Answer		Loan payable	Answer
Accounts receivable	Answer		Total liabilities	Answer
Land	Answer
			Shareholders' equity
			Common stock	Answer
			Retained earnings	Answer
			Total shareholders equity	Answer
Total assets	Answer		Total liabilities and shareholders equity	Answer

(e) Use a negative sign with answers to indicate a decrease in cash.

Smith & Co. Statement of Cash Flows For Year 1
Operating activities
Cash flow from operations	Answer
Investing activities
Cash flow from investing	Answer
Financing activities
Bank loan	Answer
Common stock	Answer
Dividend payment	Answer
Cash flow from financing	Answer
Change in cash	Answer
Cash, beginning of year	Answer
Cash, end of year	Answer