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Required information

Exercise $10-6$A $($Algo$)$ Two accounting cycles for bonds issued at face value LO $10-3$

$[$The following information applies to the questions displayed below.$]$

Doyle Company issued $\backslash (\backslash$$ $500,000\backslash )$ of $10-$year, $7$ percent bonds on January $1,$ Year $2.$ The bonds were issued at face value. Interest is payable in cash on December $31$ of each year. Doyle immediately invested the proceeds from the bond issue in land. The land was leased for an annual $\backslash (\backslash$$ $54,000\backslash )$ of cash revenue, which was collected on December $31$ of each year, beginning December $31,$ Year $2.$

Exercise $10-6$A $($Algo$)$ Part a

Required

a$.$ Organize the transaction data in accounts under the accounting equation for Year $2$ and Year $3.$

Note: Enter any decreases to account balances with a minus sign. If there is no effect on the Account Titles for Retained Earnings, leave the cell blank. Not all cells will require entry.

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|$c$|$c$|$c$|$c$|$c$|$c$|\}$

$\backslash$hline $\backslash$multicolumn$\{9\}\{|$c$|\}\{$DOYLE COMPANY$\}\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{9\}\{|$c$|\}\{$Effect of Events on the Accounting Equation$\}\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{9\}\{|$c$|\}\{$Year $2$ and Year $3\}\backslash \backslash$

$\backslash$hline $\backslash$multirow$\{2\}\{*\}\{$Event$\}$ & $\backslash$multicolumn$\{3\}\{|$c$|\}\{$Assets$\}$ & $\backslash$multicolumn$\{2\}\{|$l$|\}\{\backslash$multirow$[$t$]\{2\}\{*\}\{\backslash [$

$=\backslash$frac$\{\backslash$text $\{$ Liabilities $\}\}\{\backslash$begin$\{$array$\}\{$c$\}$

$\backslash$text $\{$ Bonds $\}\backslash \backslash$

$\backslash$text $\{$ Payable $\}$

$\backslash$end$\{$array$\}\}$

$\backslash ]\}\}$ & $\backslash$multicolumn$\{2\}\{|$r$|\}\{\backslash$multirow$[$t$]\{2\}\{*\}\{\backslash (+\backslash )\backslash$begin$\{$tabular$\}\{$c$\}$

Stockholders' $\backslash \backslash$

Equity $\backslash \backslash$

$\backslash$hline Retained $\backslash \backslash$

Earnings

$\backslash$end$\{$tabular$\}\}\}$ & $\backslash$multirow$[$b$]\{2\}\{*\}\{$Account Titles for Retained Earnings$\}\backslash \backslash$

$\backslash$hline & Cash & $+$ & Land & & & & & $\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{9\}\{|$l$|\}\{$Year $2\}\backslash \backslash$

$\backslash$hline $1/1$ & & $+$ & & $=$ & & $\backslash (+\backslash )$ & & $\backslash \backslash$

$\backslash$hline $1/1$ & & $\backslash (+\backslash )$ & & $=$ & & $\backslash (+\backslash )$ & & $\backslash \backslash$

$\backslash$hline $12/31$ & & $+$ & & $=$ & & $+$ & & $\backslash \backslash$

$\backslash$hline $12/31$ & & $+$ & & $=$ & & $\backslash (+\backslash )$ & & $\backslash \backslash$

$\backslash$hline Balance & $0$ & $\backslash (+\backslash )$ & $0$ & $=$ & $0$ & $+$ & $0$ & $\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{9\}\{|$l$|\}\{$Year $3\}\backslash \backslash$

$\backslash$hline Beginning balance & & $+$ & & $=$ & & $+$ & & $\backslash \backslash$

$\backslash$hline $12/31$ & & $\backslash (+\backslash )$ & & $=$ & & $+$ & & $\backslash \backslash$

$\backslash$hline $12/31$ & & $+$ & & $=$ & & $+$ & & $\backslash \backslash$

$\backslash$hline Ending balance & $0$ & $+$ & $0$ & $=$ & $0$ & $\backslash (+\backslash )$ & $0$ & $\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$ b$.$ Prepare the income statement, balance sheet, and statement of cash flows for Year $2$ and Year $3.$

Complete this question by entering your answers in the tabs below.

Prepare the income statement for Year $2$ and Year $3.$ b$.$ Prepare the income statement, balance sheet, and statement of cash flows for Year $2$ and Year $3.$

Complete this question by entering your answers in the tabs below.

Balance Sheet

Statement of Cash Flows

Prepare the balance sheet for Year $2$ and Year $3.$ b$.$ Prepare the income statement, balance sheet, and statement of cash flows for Year $2$ and Year $3.$

Complete this question by entering your answers in the tabs below.

Income Statement

Balance Sheet

Statement of Cash Flows

Prepare the statement of cash flows for Year $2$ and Year $3.$

Note: Cash outflows should be indicated with a minus sign.