Requlred Information

Exercise $7-2$A $($Algo$)$ Accounting for uncollectible accounts: allowance method LO $7-1$

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

Holmes Cleaning Service began operation on January $1,$ Year $1.$ The company experienced the following events for its first

year of operations.

Events Affecting Year $1$:

Provided $$130,000$ of cleaning services on account.

Collected $$97,500$ cash from accounts receivable.

Paid salaries of $$42,000$ for the year.

Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $$1,900.$

The expense was determined using the percent of revenue method.

Exerclse $7-2$A $($Algo$)$ Part c

Prepare an income statement, balance sheet, and statement of cash flows for Year $1.$

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

Prepare a balance sheet for Year $1.($Enter amounts to be deducted with a minus sign.$)$

HOLMES CLEANING SERVICE

Balance Sheet

As of December $31,$ Year $1$