Question

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Cascade Company was started on January 1, 2018, when it acquired $169,000 cash from the owners. During 2018, the company earned cash revenues of $92,300 and incurred cash expenses of $63,200. The company also paid cash distributions of $6,000.

Required

Prepare a 2018 income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows under each of the following assumptions. (Consider each assumption separately.)

	CASCADE COMPANY Balance Sheet As of December 31, 2018 Assets Cashselected answer correct not attempted not attempted not attempted Total Assets 0 Liabilities not attempted Equity Carl Cascade, capitalselected answer correct not attempted not attempted not attempted not attempted not attempted Total liabilities

	CASCADE COMPANY Balance Sheet As of December 31, 2018 Assets Cash not attempted not attempted Total Assets 0 Liabilities not attempted Equity Carl Cascade, capitalt not attempted not attempted not attempted not attempted Total liabilities

B. Cascade is a partnership with two partners, Carl Cascade and Beth Cascade. Carl Cascade invested $101,400 and Beth Cascade invested $67,600 of the $169,000 cash that was used to start the business. Beth was expected to assume the vast majority of the responsibility for operating the business. The partnership agreement called for Beth to receive 60 percent of the profits and Carl to get the remaining 40 percent. With regard to the $6,000 distribution, Beth withdrew $1,800 from the business and Carl withdrew $4,200.

	CASCADE COMPANY Income Statement For the Year Ended December 31, 2018 Revenues not attempted Expenses not attempted net income $0

CASCADE COMPANY
Capital Statement
For the Year Ended December 31, 2018
Beginning capital balance	not attempted
Plus: Capital acquired from partners	not attempted
Plus: Net income	not attempted
Less: Withdrawal by partners	not attempted
Ending capital balances	$0

CASCADE COMPANY Statement of Cash Flows For the Year Ended December 31, 2018 Cash flow from operating activities: Receipts from revenue   not attempted Paid for expenses not attempted not attempted not attempted Net cash flow from operating activities $0 Cash flows from investing activities not attempted Cash flows from financing activities: Proceeds from partner not attempted Paid for partners withdrawal not attempted not attempted not attempted Net cash flow from financing activities 0 Net change in cash 0 Plus: Beginning cash balance not attempted Ending cash balance $0

• CASCADE COMPANY
  Balance Sheet
  As of December 31, 2018
  Assets
  Cashselected answer correct	not attempted
  not attempted	not attempted
  Total Assets		0
  Liabilities		not attempted
  Equity
  not attempted	not attempted	not attempted
  Beth Cascade, capitalselected answer correct	not attempted	not attempted
  Carl Cascade, capitalselected answer correct	not attempted	not attempted
  Total liabilities and equity		$0

Answer 1

CASCADE COMPANY
Income Statement
For the Year Ended December 31, 2018
Revenues	$92,300
Less: Expenses	$63,200
Net income	$29,100

CASCADE COMPANY
Capital Statement
For the Year Ended December 31, 2018
	Carl Cascade	Beth Cascade
Beginning capital balance	$0	$0
Plus: Capital acquired from partners	$101,400	$67,600
Plus: Net income (40:60)	$11,640	$17,460
Less: Withdrawal by partners	($4,200)	($1,800)
Ending capital balances	$108,840	$83,260

CASCADE COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2018
Cash flow from operating activities:
Receipts from revenue	$92,300
Paid for expenses	($63,200)
Net cash flow from operating activities		$29,100
Cash flows from investing activities		$0
Cash flows from financing activities:
Proceeds from partner	$169,000
Paid for partners withdrawal	($6,000)
Net cash flow from financing activities		$163,000
Net change in cash		$192,100
Plus: Beginning cash balance		$0
Ending cash balance		$192,100

CASCADE COMPANY
Balance Sheet
As of December 31, 2018
Assets
Cash	$192,100
Total Assets (A)		$192,100
Liabilities	$0
Equity
Beth Cascade, capital	$83,260
Carl Cascade, capital	$108,840
Total liabilities and equity (B)		$192,100