The following accounting events apply to Mary’s Designs for Year 1: Asset Source Transactions Began operations...
The following accounting events apply to Mary’s Designs for Year
1:
Asset Source Transactions
- Began operations by acquiring $21,000 of cash from the issue of common stock.
- Performed services and collected cash of $900.
- Collected $4,900 of cash in advance for services to be provided over the next 12 months.
- Provided $12,100 of services on account.
- Purchased supplies of $490 on account.
Asset Exchange Transactions
- Purchased $4,900 of land for cash.
- Collected $7,900 of cash from accounts receivable.
- Purchased $540 of supplies with cash.
- Paid $3,200 for one year’s rent in advance.
Asset Use Transactions
- Paid $2,500 cash for salaries of employees.
- Paid a cash dividend of $2,200 to the stockholders.
- Paid off $490 of the accounts payable with cash.
Claims Exchange Transactions
- Placed an advertisement in the local newspaper for $180 on account.
- Incurred utility expense of $75 on account.
Adjusting Entries
- Recognized $3,675 of revenue for performing services. The collection of cash for these services occurred in a prior transaction. (See Event 3.)
- Recorded $1,280 of accrued salary expense at the end of Year 1.
- Recorded supplies expense. Had $85 of supplies on hand at the end of the accounting period.
- Recognized three months of expense for prepaid rent that had been used up during the accounting period.
c. Use a horizontal statements model to show
how each event affects the balance sheet, income statement, and
statement of cash flows. Indicate whether the event increases (+),
decreases (−), or does not affect (NA) each element of the
financial statements. Also, in the Statement of Cash Flows column,
use the letters OA to designate operating activity, IA for
investing activity, and FA for financing activity. The first event
is recorded as an example.
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Homework Answers
Answer:
| MARY’S DESIGNS | ||||||||||||
| Effect of Transactions on Financial Statements | ||||||||||||
| Event | Balance Sheet | Income Statement | Statement of Cash Flows | |||||||||
| Assets | = | Liabilities | + | Equity | Revenue | − | Expenses | = | Net Income | |||
| 1 | + | = | NA | + | + | NA | − | NA | = | NA | + | FA |
| 2 | + | = | NA | + | + | + | − | NA | = | NA | + | OA |
| 3 | + | = | + | + | NA | NA | − | NA | = | NA | + | OA |
| 4 | + | = | NA | + | + | + | − | NA | = | NA | NA | NA |
| 5 | + | = | + | + | NA | NA | − | NA | = | NA | NA | NA |
| 6 | + - | = | NA | + | NA | NA | − | NA | = | NA | - | IA |
| 7 | + - | = | NA | + | NA | NA | − | NA | = | NA | + | OA |
| 8 | + - | = | NA | + | NA | NA | − | NA | = | NA | - | OA |
| 9 | - + | = | NA | + | NA | NA | − | NA | = | NA | - | OA |
| 10 | - | = | NA | + | - | NA | − | + | = | NA | - | OA |
| 11 | - | = | NA | + | - | NA | − | NA | = | NA | - | FA |
| 12 | - | = | - | + | NA | NA | − | NA | = | NA | - | OA |
| 13 | NA | = | + | + | - | NA | − | + | = | NA | NA | NA |
| 14 | NA | = | + | + | - | NA | − | + | = | NA | NA | NA |
| 15 | NA | = | - | + | + | + | − | NA | = | NA | NA | NA |
| 16 | NA | = | + | + | - | NA | − | + | = | NA | NA | NA |
| 17 | - | = | NA | + | - | NA | − | + | = | NA | NA | NA |
| 18 | - | = | NA | + | - | NA | − | + | = | NA | NA | NA |
Explanations for 6,7,8,9 transactions:
| Transaction | Asset increase(+)/decrease(-) | +/- | Net affect |
| 6 | Land +, Cash - | + - | 0 |
| 7 | Cash +, Accounts receivable - | + - | 0 |
| 8 | Supplies +, Cash - | + - | 0 |
| 9 | Prepaid rent +, Cash - | - + | 0 |
Add Answer to:
The following accounting events apply to Mary’s Designs for Year
1:
Asset Source Transactions
Began operations...
The following accounting events apply to Mary’s Designs for Year 1: Asset Source Transactions Began operations...
The following accounting events apply to Mary’s Designs for Year 1: Asset Source Transactions Began operations by acquiring $21,000 of cash from the issue of common stock. Performed services and collected cash of $900. Collected $4,900 of cash in advance for services to be provided over the next 12 months. Provided $12,100 of services on account. Purchased supplies of $490 on account. Asset Exchange Transactions Purchased $4,900 of land for cash. Collected $7,900 of cash from accounts receivable. Purchased $540...
The following accounting events apply to Mary’s Designs for Year 1: Asset Source Transactions Began operations...
The following accounting events apply to Mary’s Designs for Year 1: Asset Source Transactions Began operations by acquiring $21,000 of cash from the issue of common stock. Performed services and collected cash of $900. Collected $4,900 of cash in advance for services to be provided over the next 12 months. Provided $12,100 of services on account. Purchased supplies of $490 on account. Asset Exchange Transactions Purchased $4,900 of land for cash. Collected $7,900 of cash from accounts receivable. Purchased $540...
LO 2, 4 Problem 3-27A Recording events in a statements The following Asset Source Transactions 1. Began oper CHECK FIGURE b. Total debits: $39,125 model and T-accounts and preparing a trial balan...
LO 2, 4 Problem 3-27A Recording events in a statements The following Asset Source Transactions 1. Began oper CHECK FIGURE b. Total debits: $39,125 model and T-accounts and preparing a trial balance accounting events apply to Parks Co. for the year 2011 ations when the business acquired $20,000 cash from the issue of common stock 2. Performed services and collected cash of $1,000. . Collected $4,500 of cash in advance for services to be provided over the next 12 months...
ldentify whether each of the following transactions is an asset source (AS), asset use (AU), asset...
ldentify whether each of the following transactions is an asset source (AS), asset use (AU), asset exchange (AE), or clalms exchange CE). Also show the effects of the events on the financial statements using the horizontal statements model. Indicate whether the event Increases (1), decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), Investing activities (A), or financing activities (FA), or does not...
Required Identify whether each of the following transactions is an asset source (AS), asset use (AU),...
Required Identify whether each of the following transactions is an asset source (AS), asset use (AU), asset exchange (AE), or claims exchange (CE). Also show the effects of the events on the financial statements using the horizontal statements model. Indicate whether the event increases (1), decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA), or does...
Required Identify whether each of the following transactions is an asset source (AS), asset use (AU),...
Required Identify whether each of the following transactions is an asset source (AS), asset use (AU), asset exchange (AE), or claims exchange (CE). Also show the effects of the events on the financial statements using the horizontal statements model. Indicate whether the event increases (0), decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA), or does...
Hart, Attorney af Law, experienced the following transactions in year 1, the first year of operations:...
Hart, Attorney af Law, experienced the following transactions in
year 1, the first year of operations:
1. Accepted $18,200 on April 1, year 1, as a retainer for
services to be performed evenly over the next 12 months.
2. Performed legal services for cash of $61,500.
3. Purchased $1,400 of office supplies on account.
4. Paid $1,260 of the amount due on accounts payable.
5. Paid a cash dividend to the stockholders of $4,900.
6. Paid cash for operating expenses...
Hart, Attorney at Law, experienced the following transactions in Year 1, the first year of operations:...
Hart, Attorney at Law, experienced the following transactions in
Year 1, the first year of operations:
Accepted $16,900 on April 1, Year 1, as a retainer for services
to be performed evenly over the next 12 months.
Performed legal services for cash of $69,500.
Purchased $1,450 of office supplies on account.
Paid $1,305 of the amount due on accounts payable.
Paid a cash dividend to the stockholders of $5,500.
Paid cash for operating expenses of $19,800.
Determined that at the...
Required a. In parallel columns, list the accounts that would be debited and credited for each...
Required a. In parallel columns, list the accounts that would be debited and credited for each of the following unrelated transactions: Event Account Debited Account Credited (1) Acquired cash from the issue of common stock. (2) Provided services for cash. (3) Paid cash for salaries expense. (4) Purchased supplies for cash. (5) Paid in advance for two-year lease on office space. (6) Provided services on account. |(7) Recognized expense for prepaid rent that had been used up by the end...
Hart, Attorney at Law, experienced the following transactions in Year 1, the first year of operations:...
Hart, Attorney at Law, experienced the following transactions in Year 1, the first year of operations: 1. Accepted $16,700 on April 1, Year 1, as a retainer for services to be performed evenly over the next 12 months 2. Performed legal services for cash of $69.000 3. Purchased $1.500 of office supplies on account 4. Paid $1,350 of the amount due on accounts payable. 5. Paid a cash dividend to the stockholders of $4,500 6. Paid cash for operating expenses...
LO 2, 4 Problem 3-27A Recording events in a statements The following Asset Source Transactions 1. Began oper CHECK FIGURE b. Total debits: $39,125 model and T-accounts and preparing a trial balance accounting events apply to Parks Co. for the year 2011 ations when the business acquired $20,000 cash from the issue of common stock 2. Performed services and collected cash of $1,000. . Collected $4,500 of cash in advance for services to be provided over the next 12 months...
ldentify whether each of the following transactions is an asset source (AS), asset use (AU), asset exchange (AE), or clalms exchange CE). Also show the effects of the events on the financial statements using the horizontal statements model. Indicate whether the event Increases (1), decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), Investing activities (A), or financing activities (FA), or does not...
Required Identify whether each of the following transactions is an asset source (AS), asset use (AU), asset exchange (AE), or claims exchange (CE). Also show the effects of the events on the financial statements using the horizontal statements model. Indicate whether the event increases (1), decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA), or does...
Required Identify whether each of the following transactions is an asset source (AS), asset use (AU), asset exchange (AE), or claims exchange (CE). Also show the effects of the events on the financial statements using the horizontal statements model. Indicate whether the event increases (0), decreases (D), or does not affect (NA) each element of the financial statements. In the Cash Flows column, designate the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA), or does...
Hart, Attorney af Law, experienced the following transactions in
year 1, the first year of operations:
1. Accepted $18,200 on April 1, year 1, as a retainer for
services to be performed evenly over the next 12 months.
2. Performed legal services for cash of $61,500.
3. Purchased $1,400 of office supplies on account.
4. Paid $1,260 of the amount due on accounts payable.
5. Paid a cash dividend to the stockholders of $4,900.
6. Paid cash for operating expenses...
Hart, Attorney at Law, experienced the following transactions in
Year 1, the first year of operations:
Accepted $16,900 on April 1, Year 1, as a retainer for services
to be performed evenly over the next 12 months.
Performed legal services for cash of $69,500.
Purchased $1,450 of office supplies on account.
Paid $1,305 of the amount due on accounts payable.
Paid a cash dividend to the stockholders of $5,500.
Paid cash for operating expenses of $19,800.
Determined that at the...
Required a. In parallel columns, list the accounts that would be debited and credited for each of the following unrelated transactions: Event Account Debited Account Credited (1) Acquired cash from the issue of common stock. (2) Provided services for cash. (3) Paid cash for salaries expense. (4) Purchased supplies for cash. (5) Paid in advance for two-year lease on office space. (6) Provided services on account. |(7) Recognized expense for prepaid rent that had been used up by the end...
Hart, Attorney at Law, experienced the following transactions in Year 1, the first year of operations: 1. Accepted $16,700 on April 1, Year 1, as a retainer for services to be performed evenly over the next 12 months 2. Performed legal services for cash of $69.000 3. Purchased $1.500 of office supplies on account 4. Paid $1,350 of the amount due on accounts payable. 5. Paid a cash dividend to the stockholders of $4,500 6. Paid cash for operating expenses...
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