Leach Inc. experienced the following events for the first two years of its operations: Year 1:...
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Leach Inc. experienced the following events for the first two years of its operations: Year 1: 1. Issued $10,000 of common stock for cash. 2. Provided $100,000 of services on account. 3. Provided $31,000 of services and received cash. 4. Collected $69,000 cash from accounts receivable. 5. Paid $16,000 of salaries expense for the year. 6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Year 2: 1. Wrote off an uncollectible account for $670. 2. Provided $120,000 of services on account. 3. Provided $30,000 of services and collected cash. 4. Collected $102,000 cash from accounts receivable. 5. Paid $24,000 of salaries expense for the year. 6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Prepare the balance sheet for Year 1. LEACH INC. Balance Sheet As of December 31, Year 1 Assets Cash Accounts receivable Less: Allowance for doubtful accounts Total assets Liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ $ 0 0 0 LEACH INC. Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities Inflow from customers Outflow for expenses Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Inflow from stock issued Net cash flow from financing activities Net change in cash Plus: Beginning cash balance Ending cash balance $ 69 $ LA 69 0 0 0 0 LEACH INC. Statement of Changes in Stockholders' Equity For the Year Ended December 31, Year 1 $ 10,000 0 Beginning common stock Plus: Common stock issued Ending common stock Beginning retained earnings Plus: Net income Ending retained earnings Total stockholders' equity $ 10,000 0 $ 10,000 What is the net realizable value of the accounts receivable at December 31, Year 1? Net realizable value Leach Inc. experienced the following events for the first two years of its operations: Year 1: 1. Issued $10,000 of common stock for cash. 2. Provided $100,000 of services on account. 3. Provided $31,000 of services and received cash. 4. Collected $69,000 cash from accounts receivable. 5. Paid $16,000 of salaries expense for the year. 6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Year 2: 1. Wrote off an uncollectible account for $670. 2. Provided $120,000 of services on account. 3. Provided $30,000 of services and collected cash. 4. Collected $102,000 cash from accounts receivable. 5. Paid $24,000 of salaries expense for the year. 6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Prepare the balance sheet for Year 1. LEACH INC. Balance Sheet As of December 31, Year 1 Assets Cash Accounts receivable Less: Allowance for doubtful accounts Total assets Liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ $ 0 0 0 LEACH INC. Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities Inflow from customers Outflow for expenses Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Inflow from stock issued Net cash flow from financing activities Net change in cash Plus: Beginning cash balance Ending cash balance $ 69 $ LA 69 0 0 0 0 LEACH INC. Statement of Changes in Stockholders' Equity For the Year Ended December 31, Year 1 $ 10,000 0 Beginning common stock Plus: Common stock issued Ending common stock Beginning retained earnings Plus: Net income Ending retained earnings Total stockholders' equity $ 10,000 0 $ 10,000 What is the net realizable value of the accounts receivable at December 31, Year 1? Net realizable value
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Leach Inc Year 1 Event Balance 1 3 2 Asset 4 5 Cash 3 31... View the full answer
Related Book For
Survey Of Accounting
ISBN: 9781260575293
6th Edition
Authors: Thomas Edmonds, Christopher Edmonds, Philip Olds
Posted Date:
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