Question

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Pizza Express Inc. began the 2016 accounting period with $9,000 cash, $6,500 of common stock, and $2,500 of retained earnings. Pizza Express was affected by the following acCcounting events during 2016: 1. Purchased $10,500 of supplies on account. 2. Earned and collected $28,000 of cash revenue. 3. Paid $9,000 cash on accounts payable. 4. Adjusted the records toeor 31 2016 was still supplies. A physical count indicated that $3,000 of supplies hand on December Required a. Show the effects of the events on the financial statements using a horizontal statements model given below. In the Cash Flows column, use OA to designate operating activity, IA for investing activity, FA for financing activity, NC for net change in cash and NA to indicate accounts not affected by the event. The en recorded as an example. (Enter any decreases to account balances and each sign.) PIZZA EXPRESS INC. Effect of Events on Financial Statements for 2016 Stockholders' Equity Income Statement Assets Liabilities Event Statement of Cash Flows Accounts Common Stock Retained No. =Net Income Cash Supplies Revenue Expense Payable Earnings NA 2,500 Beg. bal. 9.000 6,500 10,500 10,500 - NA 1 + + = 28,000 28.000 OA 28.000+ 28,000 28.000 2 NA (9,000)+ 3. (9,000) 7,500 (7,500) NA (7,500) 3,000 (7,500) + + 28.000 28,000 7,500= 28,000 NA 1.500 - 23,000 20,500 Totals 6,500

Answer 1

Answer

--Requirement

Event	Cash	Supplies	Accounts Payable	Common Stock	retained earnings	Revenues	Expenses	Net Income	Statement of Cash Flows
Beg Bal	$9,000			$6,500	$2,500					NA
1		$10,500	$10,500							NA
2	$28,000				$28,000	$28,000		$28,000	$28,000	OA
3	($9,000)		($9,000)						($9,000)	OA
4		($7,500)			($7,500)		$7,500	($7,500)		NA
Totals	$28,000	$3,000	$1,500	$6,500	$23,000	$28,000	$7,500	$20,500	$19,000	NC