James Nesbitt established Up-Date Computer Services on August 1, 20Y4. The effect of each transaction and the
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- James Nesbitt established Up-Date Computer Services on August 1, 20Y4. The effect of each transaction and the balances after each transaction for August are shown below in the integrated financial statement framework.
Statement of Cash Flows | Balance Sheet | |||||||||
Assets | = | Liabilities | + | Stockholders' Equity | ||||||
Cash | + | Land | = | Notes Payable | + | Common Stock | + | Retained Earnings | ||
a. Issued common stock | 25,000 | 25,000 | ||||||||
b. Fees earned | 27,000 | 27,000 | ||||||||
Balances | 52,000 | 25,000 | 27,000 | |||||||
c. Rent expense | (2,500) | (2,500) | ||||||||
Balances | 49,500 | 25,000 | 24,500 | |||||||
d. Issued notes payable | 10,000 | 10,000 | ||||||||
Balances | 59,500 | 10,000 | 25,000 | 24,500 | ||||||
e. Purchased land | (40,000) | 40,000 | ||||||||
Balances | 19,500 | 40,000 | 10,000 | 25,000 | 24,500 | |||||
f. Paid expenses | (1,900) | (1,900) | ||||||||
Balances | 17,600 | 40,000 | 10,000 | 25,000 | 22,600 | |||||
g. Paid salary expense | (4,600) | (4,600) | ||||||||
Balances | 13,000 | 40,000 | 10,000 | 25,000 | 18,000 | |||||
h. Paid dividends | (3,000) | (3,000) | ||||||||
Balances, Aug. 31 | 10,000 | 40,000 | 10,000 | 25,000 | 15,000 | |||||
Statement of Cash Flows | Income Statement | |||||||||
a. Financing | 25,000 | b. Fees earned | 27,000 | |||||||
b. Operating | 27,000 | c. Rent expense | (2,500) | |||||||
c. Operating | (2,500) | f. Auto expense | (1,200) | |||||||
d. Financing | 10,000 | f. Misc. expense | (700) | |||||||
e. Investing | (40,000) | g. Salary expense | (4,600) | |||||||
f. Operating | (1,900) | Net income | 18,000 | |||||||
g. Operating | (4,600) | |||||||||
h. Financing | (3,000) | |||||||||
Increase in cash | 10,000 |
Indicate the effects of each transaction on the liquidity metric Cash and profitability metric Net Income – Cash Basis. If a transaction is not affected, select "No effect" and enter 0 in the amount box. If the effect on a transaction is negative, i.e, a decrease, be sure to enter the answer with a minus sign.
Transaction Metric Effects | |||||||
Transaction | Liquidity Cash | Profitability Net Income – Cash Basis | |||||
a. | Issued stock | $ | $ | ||||
b. | Earned fees | ||||||
c. | Paid rent | ||||||
d. | Issued note payable | ||||||
e. | Purchased land | ||||||
f. | Paid expenses | ||||||
g. | Paid salaries | ||||||
h. | Paid dividends | ||||||
Total | $ | $ |
Related Book For
Advanced Accounting
ISBN: 978-1259444951
13th edition
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupni
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