Exercise $2-20$A $($Static$)$ Unearned revenue and the financial statements model LO $2-7$

Clark Bell started a personal financial planning business when he accepted $$36,000$ cash as advance payment for managing the financial assets of a large estate. Bell agreed to manage the estate for a one$-$year period beginning June $1,$ Year $1.$

Required

Show the effects of the advance payment and revenue recognition on the Year $1$ financial statements using a horizontal statements model like the following one. In the Cash Flows column, use OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for net change in cash. If the account is not affected, leave the cell blank.

How much revenue would Bell recognize on the Year $2$ income statement?

What is the amount of cash flow from operating activities in Year $2?$