Chapter 2 Homework Help Save&Exit 10 Yard Designs (YD) experienced the following

Question

Chapter 2 Homework Help Save&Exit 10 Yard Designs (YD) experienced the following events in Year 1, its first year of operation: 10 points 1. On October 1, Year 1, YD collected $21,600 for consulting services it agreed to provide during the coming year 2. Adjusted the accounts to reflect the amount of consulting service revenue recognized in Year 1 eBookRequired Based on this information alone: a. Record the events under an accounting equation. b. Prepare an income statement, balance sheet, and statement of cash flows for the Year 1 accounting period. c. Ignoring all other future events, what is the amount of service revenue that would be recognized in Year 2? Print Complete this question by entering your answers in the tabs belovw Req B Inc Req B Bal Req B Stmt of Req A Req C Stmt Cash Flows Record the events under an accounting equation. (Do not round intermediate calculations. Enter any decreases to account balances with a minus sign.) YARD DESIGNS ting Equations for the Year 1

Explanation / Answer

Accounting equation: Event Cash = unearned+ Retained Revenue Earnings Consulting revenue 21600 21600 Adjusting entry -5400 5400 Total 21600 16200 5400 Req b: Income Statement: Service revenue Revenue received for Oct1 to Dec31 5400 Net icnome 5400 Req B Balance Sheet Assets: Cash 21600 Total assets 21600 Liabilities: Unearned revenue 16200 Total liabilities 16200 Stockholder's equity: Retained earnings 5400 Total Stockholder's equity 5400 Total Liabilities and Stockholder' equity 21600 Req B: Statement of Cash flows: Cashflows from Operating activities: Collection of revenue 21600 Net cash provided from Operating activities 21600 Cashflows from Investing activities 0 Cashflows from Financing activities 0 Net change in cash 21600 Beginning balance of cash 0 Ending balance of cash 21600 Req C: Total revenue received 21600 Less: Recognized in Year-1 5400 Revenue recognized in Year-2 16200

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