Question

Exercise 2-9A Effect of accounts receivable and accounts payable transactions on financial statements LO 2-1, 2-2, 2-3, 2-4 The following events apply to Lewis and Harper, a public accounting firm, for the Year 1 accounting period: Performed $89,500 of services for clients on account. Performed $51,000 of services for cash. Incurred $50,000 of other operating expenses on account. Paid $20,500 cash to an employee for salary. Collected $65,000 cash from accounts receivable. Paid $19,000 cash on accounts payable. Paid an $8,000 cash dividend to the stockholders. Accrued salaries were $4,200 at the end of Year 1.

Exercise 2-9A Effect of accounts receivable and accounts payable transactions on financial statements LO 2-1, 2-2, 2-3, 2-4 The following events apply to Lewis and Harper, a public accounting firm, for the Year 1 accounting period: 1. Performed $89,500 of services for clients on account. 2. Performed $51,000 of services for cash. 3. Incurred $50,000 of other operating expenses on account. 4. Paid $20,500 cash to an employee for salary. 5. Collected $65,000 cash from accounts receivable. 6. Paid $19,000 cash on accounts payable. 7. Paid an $8,000 cash dividend to the stockholders. 8. Accrued salaries were $4,200 at the end of Year 1.

Answer 1

c)
	Account Receivables
	Services Performed	89500
	Less:
	Collected	65000
	Balance	24500

f)
	Revenue
	Services
	On Account	$             89,500
	Cash	$             51,000
		$         1,40,500
	Less:
	Operating Expenses	$             50,000
	Salary	$             24,700
		$             74,700
	Net income	$             65,800