Question

Required information (The following information applies to the questions displayed below.) Leach Inc. experienced the following events for the first two years of its operations: 2018: 1. Issued $10,000 of common stock for cash. 2. Provided $110,000 of services on account. 3. Provided $25,000 of services and received cash. 4. Collected $85,000 cash from accounts receivable. 5. Paid $20,000 of salaries expense for the year. 6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 9 percent of the ending accounts receivable balance will be uncollectible. 2019: 1. Wrote off an uncollectible account for $700. 2. Provided $130,000 of services on account. 3. Provided $25,000 of services and collected cash. 4. Collected $112,000 cash from accounts receivable. 5. Paid $26,000 of salaries expense for the year. 6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 9 percent of the ending accounts receivable balance will be uncollectible. d-1. Organize the transaction data in accounts under an accounting equation. d-2. Prepare an income statement for 2019. < Prey 6 of 13 Next >

need help with d-1 to d-6 and also net realizable value for the year 2018

Answer 1

Leach Inc. Accounting Equation For the Year 2018 = Liabilities + Assets + Accounts + Receivable - Allowance Accounting Titles for Retained Earnings Event + Cash 10000 Equity Common Retained Stock + Earnings 10000 + 110000 + 25000 + + 110000 + Service Revenue Service Revenue + 25000 85000 -20000 + -85000 + + + + + + Salaries Expense Bad Debts estimated 2250 2250 -20000 -2250 112750 Totals 100000 + 25000 - + 10000 122750 122750 25000 x 9% = 2250 Accounting Equation For the Year 2019 = Liabilities + Accounting Titles for Retained Earnings + Event Bal. Cash 100000 Assets + Accounts + Receivable - Allowance + 25000 2250 -700 -700 130000 Equity Common Retained Stock + Earnings 10000 + 112750 -200 130000 + 25000 + + Uncollectibles written off Service Revenue Service Revenue + 25000 112000 -26000 -112000 + + + Salaries Expense Bad Debts estimated + -26000 -2257 239293 2257 3807 - = 0 + + Totals 211000 + 42300 249493 42300 x 9% = 3807 - 2250 + 700 = 2257 10000 249293

155000 Statement of Income For the Year 2019 Service Revenue Less:Operating Expense Salaries Expense Bad Debts Expense Total Operating Expense Net Income 26000 2457 28457 126543 Statement of Changes in Stockholders Equity For the Year 2019 Beginning Common Stock 10000 Plus:Common Stock issued Ending Common Stock 10000 Beginning Retained Earnings Plus:Net Income Ending Retained Earnings 112750 126543 239293 Statement of Cashflows For the Year 2019 Cashflow from Operating Activity Net Income Adjustments: Increase in Accounts Receivable Cash generated from Operating Activity 126543 - 15743 -15743 110800 Cashflow from Investing Activity Cash generated from Investing Activity Cashflow from Financing Activity Cash generated from Financing Activity Net Increase in Cash Beginning Cash Balance Ending Cash Balance 110800 100000 210800

Balance sheet As at 31.12.2019 Assets Cash Accounts Receivable 211000 38493 Total Assets 249493 0 Liabilities Stockholders Equity Common Stock Retained Earnings 10000 239293 Total Liabilities & Stockholders Equity 249293 Accounts Receivable Net Realisable Value = 42300 - 3807 = 38493