Chapter 3, Problem 9AE

a.

To determine

Record the Year 1 transactions in T-accounts.

b.

To determine

Indicate the event of year 1that affects the balance sheet, income statement, and statement of cash flows.

c.

To determine

Ascertain the amount of revenue that would be reported on the Year 1 income statement of Company D.

d.

To determine

Ascertain the amount of cash flow from operating activity that would be reported on the Year 1 statement of cash flows of Company D.

e.

To determine

Open T-account for retained earnings, and close the Year 1 service revenue account.

f.

To determine

Record the year 2 cash collection in the appropriate T-accounts.

g.

To determine

Indicate the event of year 2 that affects the balance sheet, income statement, and statement of cash flows.

h.

To determine

Ascertain the amount of net income and net cash flow from operating activities for Year 2.