I need help with Numbers 3 and 4. Also, if you can, which of the three listed fr

Question

I need help with Numbers 3 and 4. Also, if you can, which of the three listed from number 2 is the correct option? Priority answer for numbers number 3 and 4 please.

Obj 1, 2, 3 V3. Net incom 18,000 P2-1 Transactions and financial statements Van Jordan established an insurance agency on March 1, 20Y5, and completed the following transactions during March a. Opened a business bank account in the name of Jordan Insurance Inc., with a deposit of $50,000 in exchange for capital stock. b. Borowed $25,000 by issuing a note payable c. Received cash from fees earned, $28,000 d. Paid rent on office and equipment for the month, $3,000 e. Paid automobile expense for the month, $1,800, and miscellaneous expense, $900 f. Paid office salaries, $4,200 g. Paid interest on the note payable, $100 h. Purchased land as a future building site, paying cash of $55,000 i. Paid dividends, $4,000 Instructions 1. Indicate the effect of each transaction and the balances after each transaction, using the integrated financial statement framework 2. Briefly explain why the stockholders investments and revenues increased stockholders equity, while dividends and expenses decreased stockholders' equity 3. Prepare an income statement and retained earnings statement for March 4. Prepare a balance sheet as of March 31, 20Y5 5. Prepare a statement of cash flows for Marclh

Explanation / Answer

Answer 3. Income Statement For the Month Ended March 31, 20X5 Revenues Fees Earned          28,000 Less: Expenses Rent - Office and Equipments            3,000 Automobile Exp.            1,800 Misc. Exp.                900 Office Salaries            4,200 Interest on Notes Payable                100 Total expenses          10,000 Net Income          18,000 Retained Earning Statement For the Month Ended March 31, 20X5 Net Income          18,000 Less: Dividend Paid          (4,000) Retained Earnings, March 31, 20X5          14,000 Answer 4. Balance Sheet March 31, 20X5 Assets Current Assets Cash          34,000 Fixed Assets Land          55,000 Total Assets          89,000 Liabilities Notes Payable          25,000 Total Liabilities          25,000 Stockholders' Equity Common Stock          50,000 Retained Earnings          14,000 Total Stockholders' Equity          64,000 Total Liabilities and Stockholders' Equity          89,000 Answer 2. Stockholder's equity icomprised of company's cumulative earnings or retained earnings and the amount of capital invested by its shareholders in exchange for shares. When an increase occurs in a company's earnings or capital, the overall result is an increase to the company's stockholder's equity balance. Shareholder's equity may increase from selling shares of stock, raising the company's revenues and decreasing its operating expenses. When a dividends are paid, it will reduce the retained earnings and its overall effect will be decreased inShareholders' Equity.

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