12345Amounts billed to clients for services rendered6 Cash collected from clients7Cash disbursements:8Salaries paid to employees for services rendered during the year9Utilities10Purchase of insurance policy11 Additional information:12Utility costs year 113Liabilities at the end of year 214Anticipated bad debts on receivablesInsurance policy termA1. Calculate the net operating cash flow for years 1 and 2.2. Calculate the amount of receivables from clients that the firm would2223242526 Revenues27 Expenses:28 Salaries29 Utilities3031323334BListed below are several transactions that took place during the first two years of operations for an accounting firm:InsuranceNet income (loss)151617 Required:18192021 show in its year 1 and year 2 balance sheets prepared according to theaccrual accounting model.3. Prepare an income statement for each year according to the accrual accounting model.Income Statements - Accrual basisYear 1$260,000208,000104,00062,00064,000Year 1($22,000)Year 1$260,000C104,00050,000Year 2$325,000293,000130,00087,000050,000004Year 2$76,000Year 2$325,000D130,000years[

Income statement :— It is one of the financial statement that shows profitability, total revenue and…

3 9 A Amounts billed to clients for services rendered Cash collected from clients Cash disbursements: Salaries paid to employees for services rendered during the year Utilities Purchase of insurance policy 0 1 Additional information: 2 Utility costs year 1 3 Liabilities at the end of year 2 4 Anticipated bad debts on receivables 5 Insurance policy term 6 7 Required: 8 2 3 4 Listed below are several transactions that took place during the first two years of operations for an accounting firm: 91. Calculate the net operating cash flow for years 1 and 2. 0 2. Calculate the amount of receivables from clients that the firm would 1 show in its year 1 and year 2 balance sheets prepared according to the accrual accounting model. B Insurance Net income (loss) Year 1 $260,000 208,000 104,000 62,000 64,000 2 3 3. Prepare an income statement for each year according to the accrual accounting model. 4 Income Statements - Accrual basis 5 6 Revenues 7 Expenses: 8 Salaries 9 Utilities 0 1 Year 1 ($22,000) Year 2 $325,000 293,000 130,000 87,000 0 50,000 0 0 4 Year 2 $76,000 Year 1 Year 2 $260,000 $325,000 D 104,000✔ 130,000 50,000 years I

3 9 A Amounts billed to clients for services rendered Cash collected from clients Cash disbursements: Salaries paid to employees for services rendered during the year Utilities Purchase of insurance policy 0 1 Additional information: 2 Utility costs year 1 3 Liabilities at the end of year 2 4 Anticipated bad debts on receivables 5 Insurance policy term 6 7 Required: 8 2 3 4 Listed below are several transactions that took place during the first two years of operations for an accounting firm: 91. Calculate the net operating cash flow for years 1 and 2. 0 2. Calculate the amount of receivables from clients that the firm would 1 show in its year 1 and year 2 balance sheets prepared according to the accrual accounting model. B Insurance Net income (loss) Year 1 $260,000 208,000 104,000 62,000 64,000 2 3 3. Prepare an income statement for each year according to the accrual accounting model. 4 Income Statements - Accrual basis 5 6 Revenues 7 Expenses: 8 Salaries 9 Utilities 0 1 Year 1 ($22,000) Year 2 $325,000 293,000 130,000 87,000 0 50,000 0 0 4 Year 2 $76,000 Year 1 Year 2 $260,000 $325,000 D 104,000✔ 130,000 50,000 years I

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following are the accounts and clsosing balances for Eventful Events Planning on December 31, 2021 Accounts Payable Accounts Receivable Bank Loan Cash Credit Card Receivable Ed Edwards, Capital Ed Edwards, Withdrawals Insurance Expense Office Equipment Office Supplies Expense Prepaid Insurance Rent Expense Service Revenue Travel Expense Unearned Revenue $880 $1,450 $4,640 $16,450 $950 $10,745 $8,750 $3,300 $6,985 $450 $1,650 $8,400 $36,400 $5,125 $845 16 18 11 12 13 14 15 16 17 18 19 20 21 22 Ed Edwards did not invest any new money into the company 23 during the year 24 25 From the above information, prepare the three financial statements, 26 Income Statement, Statement of Changes to Equity, Balance Sheet 27 28
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