Oaks Company had the following balances in its accounting records as of December
ID: 2418591 • Letter: O
Question
Oaks Company had the following balances in its accounting records as of December 31, 2009: Assets Claims Cash $61,000 Accounts Payable $25,000 Accounts Receivable 45,000 Common Stock 90,000 Land 27,000 Retained Earnings 18,000 Totals $133,000 $133,000 The following accounting events apply to Oaks’s 2010 fiscal year: Jan. 1 Acquired an additional $70,000 cash from the issue of common stock. April 1 Paid $6,600 cash in advance for a one-year lease for office space. June 1 Paid a $3,000 cash dividend to the stockholders. July 1 Purchased additional land that cost $25,000 cash. Aug. 1 Made a cash payment on accounts payable of $13,000. Sept. 1 Received $8,400 cash in advance as a retainer for services to be performed monthly during the next eight months. Sept. 30 Sold land for $15,000 cash that had originally cost $15,000. Oct. 1 Purchased $900 of supplies on account. Dec. 31 Earned $80,000 of service revenue on account during the year. 31 Received $66,000 cash collections from accounts receivable. 31 Incurred $16,000 other operating expenses on account during the year. 31 Recognized accrued salaries expense of $5,000. 31 Had $250 of supplies on hand at the end of the period. 31 The land purchased on July 1 had a market value of $28,000. Required: Based on the preceding information, answer the following questions. All questions pertain to the 2010 financial statements. (Hint: Record the events in general ledger accounts under an accounting equation before answering the questions.)
a. What two additional adjusting entries need to be made at the end of the year?
b. What amount would be reported for land on the balance sheet?
c. What amount of net cash flow from operating activities would Oaks report on the statement of cash flows?
d. What amount of rent expense would Oaks report in the income statement?
e. What amount of total liabilities would Oaks report on the balance sheet?
f. What amount of supplies expense would Oaks report on the income statement?
g. What amount of unearned revenue would Oaks report on the balance sheet?
h. What amount of net cash flow from investing activities would Oaks report on the statement of cash flows?
i. What amount of total expenses would Oaks report on the income statement?
j. What total amount of service revenues would Oaks report on the income statement? k. What amount of cash flows from financing activities would Oaks report on the statement of cash flows?
l. What amount of net income would Oaks report on the income statement?
m. What amount of retained earnings would Oaks report on the balance sheet? PLEASE ANSWER (A TO M ) ASAP
Explanation / Answer
Ans a Two adjusting entries Dr Cr Supplies Expenses(900-250) $650 Supplies $650 (As closing balnce of supplies is $250 so $650 worth supplies used) Unearned Revenue($8400/8*4) 4200 Service Revenue 4200 (Being cash received in advance on Sept 1 for 8 months service so on 31 Dec there is earned revenue for four months Rent (6600/12*9) 4950 Prepaid rent 4950 Ans B Land=27000+25000-15000 37000 Ans D Rent expense 4950 Ans c Cash flow from Operating activities Payment of Rent -6600 Payment of accounts payable -13000 Received for retainer services 8400 Cash collection from accounts receivable 66000 Ans c Cash flow from Operating activities 54800 Ans F Supplies expenses 650 Ans G Uneraned Revenue(8400-4200) 4200
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.