Cash collected from clients Cash disbursements; Salaries paid to employees for services rendered during the year Utilities Purchase of insurance policy. In addition, you learn that the firm incurred utility costs of $37,000 in year 1, that there were no liabilities at the end of year 2, no anticipated bad debts on receivables, and that the insurance policy covers a three-year period. Required: 1. & 3. Calculate the net operating cash flow for years 1 and 2 and determine the amount of receivables from clients that the firm would show in its year 1 and year 2 balance sheets prepared according to the accrual accounting model. 2. Prepare an income statement for each year according to the accrual accounting model. Complete this question by entering your answers in the tabs below. Req 1 and 3 Req 2 Prepare an income statement for each year according to the accrual accounting model. Perez Associates Income Statements Revenues Expenses Salaries Utilibes Insurance. Answer is complete but not entirely correct. Year 1 $ 178,000 94,000 37,000 30.400 Year 2 228,000 164,000 94,000 32,000 61,200 104,000 44,000 194,000 104,000 44,000 0 *

Cash collected from clients Cash disbursements; Salaries paid to employees for services rendered during the year Utilities Purchase of insurance policy. In addition, you learn that the firm incurred utility costs of $37,000 in year 1, that there were no liabilities at the end of year 2, no anticipated bad debts on receivables, and that the insurance policy covers a three-year period. Required: 1. & 3. Calculate the net operating cash flow for years 1 and 2 and determine the amount of receivables from clients that the firm would show in its year 1 and year 2 balance sheets prepared according to the accrual accounting model. 2. Prepare an income statement for each year according to the accrual accounting model. Complete this question by entering your answers in the tabs below. Req 1 and 3 Req 2 Prepare an income statement for each year according to the accrual accounting model. Perez Associates Income Statements Revenues Expenses Salaries Utilibes Insurance. Answer is complete but not entirely correct. Year 1 $ 178,000 94,000 37,000 30.400 Year 2 228,000 164,000 94,000 32,000 61,200 104,000 44,000 194,000 104,000 44,000 0 *

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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