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Milo Clothing experienced the following events during Year 1, its first year of operation: 1. Acquired $17,000 cash from the issue of common stock. 2. Purchased inventory for $5,300 cash 3. Sold inventory costing $3,180 for $5,406 cash. 4. Paid $900 for advertising expense. Required: Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (A), or financing activities (FA). Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. Event Cash Assets Inventand MILO CLOTHING Effect of Events on the Financial Statements Stockholders Equity Common Retained Revenue Expenses Net Statement of Cash

Milo Clothing experienced the following events during Year 1, its first year of operation: 1. Acquired $17,000 cash from the issue of common stock. 2. Purchased inventory for $5,300 cash 3. Sold inventory costing $3,180 for $5,406 cash. 4. Paid $900 for advertising expense. Required: Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (A), or financing activities (FA). Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. Event Cash Assets Inventand MILO CLOTHING Effect of Events on the Financial Statements Stockholders Equity Common Retained Revenue Expenses Net Statement of Cash

FINANCIAL ACCOUNTING
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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R tes Milo Clothing experienced the following events during Year 1, its first year of operation: 1. Acquired $17,000 cash from the issue of common stock. 2. Purchased inventory for $5,300 cash. 3. Sold inventory costing $3,180 for $5,406 cash. 4. Paid $900 for advertising expense. Required: Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. Total Event 1. 2. Ja 36 4 Cash Assets 0+ NC-Net change in cash Inventory MILO CLOTHING Effect of Events on the Financial Statements Stockholders' Equity Common Stock 0 . Retained Revenue Earnings Expenses w 0 W Net Income 0 Statement of Cash Flows ONC Checke
Transcribed Image Text:R tes Milo Clothing experienced the following events during Year 1, its first year of operation: 1. Acquired $17,000 cash from the issue of common stock. 2. Purchased inventory for $5,300 cash. 3. Sold inventory costing $3,180 for $5,406 cash. 4. Paid $900 for advertising expense. Required: Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. Total Event 1. 2. Ja 36 4 Cash Assets 0+ NC-Net change in cash Inventory MILO CLOTHING Effect of Events on the Financial Statements Stockholders' Equity Common Stock 0 . Retained Revenue Earnings Expenses w 0 W Net Income 0 Statement of Cash Flows ONC Checke
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