Clark Bell started a personal financial planning business when he accepted $36,000 cash as advance payment for managing the financlal assets of a large estate. Bell agreed to manage the estate for a one-year perlod beginning June 1, Year 1. Required a. Show the effects of the advance payment and revenue recognition on the Year 1 financlal statements using the following hortzontal statements model. In the Cash Flows column, use OA to deslgnate operating activity, IA for Investing activity, FA for financing activity, and NC for net change In cash. If the account Is not affected, leave the cell blank. b. How much revenue would Bell recognize on the Year 2 Income statement? c What Is the amount of cash flow from operating activitles In Year 2?
Clark Bell started a personal financial planning business when he accepted $36,000 cash as advance payment for managing the financlal assets of a large estate. Bell agreed to manage the estate for a one-year perlod beginning June 1, Year 1. Required a. Show the effects of the advance payment and revenue recognition on the Year 1 financlal statements using the following hortzontal statements model. In the Cash Flows column, use OA to deslgnate operating activity, IA for Investing activity, FA for financing activity, and NC for net change In cash. If the account Is not affected, leave the cell blank. b. How much revenue would Bell recognize on the Year 2 Income statement? c What Is the amount of cash flow from operating activitles In Year 2?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Could you please help me solving this question? Please
Transcribed Image Text:Clark Bell started a personal financlal planning business when he accepted $36,000 cash as advance payment for managing the
financlal assets of a large estate. Bell agreed to manage the estate for a one-year perlod beginning June 1, Year 1.
Required
a. Show the effects of the advance payment and revenue recognltion on the Year 1 financlal statements using the following horlzontal
statements model. In the Cash Flows column, use OA to designate operating activity, IA for Investing activity, FA for financing
activity, and NC for net change In cash. If the account Is not affected, leave the cell blank.
b. How much revenue would Bell recognize on the Year 2 Income statement?
c What Is the amount of cash flow from operating activitles In Year 2?
Complete this question by entering your answers in the tabs below.
Req A
Req B and C
How much revenue would Bell recognize on the Year 2 income statement? What is the amount of cash flow from
operating activities in Year 2? (Do not round intermediate calculations.)
b. Revenue to be recognized in Year 2
Amount of cash flow from operating
C.
activities
< Req A
Transcribed Image Text:Clark Bell started a personal financlal planning business when he accepted $36,000 cash as advance payment for managing the
financlal assets of a large estate. Bell agreed to manage the estate for a one-year perlod beginning June 1, Year 1.
Required
a Show the effects of the advance payment and revenue recognition on the Year 1 financlal statements using the following horizontal
statements model. In the Cash Rows column, use OA to designate operating activity, IA for Investing activity, FA for financing
activity, and NC for net change in cash. If the account Is not affected, leave the cell blank.
b. How much revenue would Bell recogntze on the Year 2 Income statement?
c What Is the amount of cash flow from operating activitles In Year 2?
Complete this question by entering your answers in the tabs below.
Req A
Req B and C
Show the effects of the advance payment and revenue recognition on the Year 1 financial statements using the following horizontal statements
model. In the Cash Flows column, use OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for net change in
cash. If the account is not affected, leave the cell blank. (Do not round intermediate calculations. Enter any decreases to account balances and cash
outflows with a minus sign. Not all cells will require entry.)
Show less A
BELL PERSONAL FINANCIAL PLANNING
Horizontal Statements Model for Year 1
Stockholders
Equity
Retained
Earnings
Assets
Liabilities +
Income Statement
Event
Statement of Cash
Flows
Unearned
Revenue
Expense = Net Income
Cash
Revenue
1. Advance payment
2. Revenue earned
Totals
Reg B and C >
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education