Preparing financial statementsDurango, Inc., experienced the following events during 2011....

Preparing financial statements

Durango, Inc., experienced the following events during 2011.

1. Acquired $55,000 cash from the issue of common stock.

2. Paid $15,000 cash to purchase land.

3. Borrowed $10,000 cash from First Bank.

4. Provided services for $28,000 cash.

5. Paid $2,500 cash for utilities expense.

6.Paid $ 11,000 cash for other operating expenses.

7. Paid a $2,000 cash dividend to the stockholders.

8.Determined that the market value of the land purchased in Event 2 is $23,000.

Required

a. The January 1, 2011, general ledger account balances are shown in the following accounting equation. Record the eight events in the appropriate general ledger accounts. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of the table. The first event is shown as an example.

b. Prepare an income statement, statement of changes in stockholders’ equity, year-end balance sheet, and statement of cash flows for the 2011 accounting period.

c. Determine the percentage of assets that were provided by retained earnings. How much cash is in the retained earnings account?