Oz Company was started when it issued bonds with a $290,000 face value on January 1, Year 1. The bonds were issued for cash at 98. Oz uses the straight-line method of amortization. They had a 20-year term to maturity and an 9 percent annual interest rate. Interest was payable on December 31 of each year. Oz Company immediately purchased land with the proceeds (cash received) from the bond issue. Oz leased the land for $32,625 cash per year. On January 1, Year 4, the company sold the land for $285,200 cash. Immediately after the sale of the land, Oz redeemed the bonds at 99. Assume that no other accounting events occurred during Year 4.

Required

Prepare an income statement, statement of changes in equity, balance sheet, and statement of cash flows for the Year 1, Year 2, Year 3, and Year 4 accounting periods. Assume that the company closes its books on December 31 of each year. Prepare the statements using a vertical statements format. (Hint: Record each years transactions in T-accounts prior to preparing the financial statements.) (Amounts to be deducted should be indicated with a minus sign.)

Check m Company was started when it issued bonds with a $290,000 face value on January 1, Year 1. The bonds were issued for cash at 98 Oz uses the straight-line method of amortization. They had a 20-year term to maturity and an 9 percent annual interest rate. Interest was payable on December 31 of each year. Oz Company immediately purchased land with the proceeds (cash received) from the bond issue. Oz leased the land for $32,625 cash per year. after the sale of the land, Oz redeemed the bonds at 99. Assume that no other accounting events occurred during Year 4 On January 1, Year 4, the company sold the land for $285.200 cash. Immediately Required Prepare an income statement, statement of changes in equity, balance sheet, and statement of cash flows for the Year t and Year 4 accounting periods. Assume that the company closes its books on December 31 of i Year 2. Year 3 Hint Record each years transactions in T-accounts prior to preparing the financial statements.) (Amounts eBook Ask Print ferences a vertical statements format ( to be deducted should be indicated with a minus sign.) OZ COMPANY Income Statements For the Year Ended December 31 Year 2 Year 3 Year 4 Year 1 ease revenue expense ating income Non-Operating income/expense Gain on sale of land Loss on bond redemption Net income(loss ints OZ COMPANY Statement of Changes in Stockholders' Equity For the Year Ended December 31 eBlook Ask Year 3 Year 4 Year 2 Year 1 Print Common stock Beginning retained earnings Net income(loss) eferences nding retained earnings Total stockholders' equity OZ COMPANY Balance Sheets As of December 31 Year 2 Year 3 Year 4 Year 1 Assets Cash Land Book Ask rint Total Assets rences Liabilities Bonds payable Less Discount on bonds payable Total Liabilities Stockholders equity Retained earnings Total liabilities and stockholders' equity Statements of Cash Flows For the Year Ended December 31 Year 1 Year 3 Year 2 Year 4 Cash flows from operating activities Receipts from lease Paid for interest Net cash flow from operating activities Cash flow from investing activities Receipt from sale of land Paid to purchase land Net cash flow from investing activities Cash flow from financing activities Proceeds from bond issue Redemption of bond Net cash flow from financing activities Net change in cash Beginning cash balance Ending cash balance Next> KPrev 4 of 5