The following transactions apply to Hooper Co. for 2018, its first year of operations: 1. Issued $60,000
Question:
The following transactions apply to Hooper Co. for 2018, its first year of operations:
1. Issued $60,000 of common stock for cash.
2. Provided $90,000 of services on account.
3. Collected $78,000 cash from accounts receivable.
4. Loaned $20,000 to Mosby Co. on November 30, 2018. The note had a one-year term to maturity and a 6 percent interest rate.
5. Paid $26,000 of salaries expense for the year.
6. Paid a $2,000 dividend to the stockholders.
7. Recorded the accrued interest on December 31, 2018 (see item 4).
8. Estimated that 1 percent of service revenue will be uncollectible.
Required
a. Show the effects of these transactions in a horizontal statements model like the one shown as follows.
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b. Prepare the income statement, balance sheet, and statement of cash flows for 2018.
Common StockCommon stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...
Step by Step Answer:
a Hooper Co Horizontal Statements Model Balance Sheet Income Statement Statement of Event Assets Equity Rev Exp Net Inc Cash Flows Cash Accts Rec Allo...View the full answer
Survey of Accounting
ISBN: 978-1259631122
5th edition
Authors: Thomas Edmonds, Christopher Edmonds, Philip Olds, Frances McNair, Bor Yi Tsay
