ollie company experienced the following events during its first year of operatio

Q: ollie company experienced the following events during its first year of operatio

a) Events that will affect income statement Event 3 – Earned $ 59,000 of cash revenue Event 4 – Incurred $ 43,000 of cash expenses b) Income Statement OLLIE COMPANY Income Statement For the year ended December 31, Year1 cash revenue $ 59,000 Less: Cash expenses $ 43,000 Net Income $ 16,000 OLLIE COMPANY Income Statement For the year ended December 31, Year1 cash revenue $ 59,000 Less: Cash expenses $ 43,000 Net Income $ 16,000

ID: 2337212 • Letter: O

Question

ollie company experienced the following events during its first year of operations.

1. Acquired $72,000 cash from the issue of common stock.
2. borrowed $26,000 from the first City Bank.
3. earned $59,000 of cash Revenue.
4. incurred $43,000 of cash expenses.
5. paid a $7,000 cash dividend.
6. paid $43,000 to purchase land.

4 Required a. Identify the events that will affect the income statement. (Select all that apply.) Event #1 Event #2 Event #3 Event #4 Event #5 | Event #6 10 points eBook Hint Print References b. Prepare an income statement that shows the results of Year 1 operations. OLLIE COMPANY Income Statement For the Year Ended December 31, Year 1 Mc Graw

Explanation / Answer

a) Events that will affect income statement

Event 3 – Earned $ 59,000 of cash revenue

Event 4 – Incurred $ 43,000 of cash expenses

b) Income Statement

OLLIE COMPANY

Income Statement

For the year ended December 31, Year1

cash revenue

$ 59,000

Less: Cash expenses

$ 43,000

Net Income

$ 16,000