Problem 1-33Interrelationships among financial statements Crawford Enterprises started the 2014 accounting period with $75,000 of assets (all cash), $15,000 of liabilities, and $25,000 of common stock. During the year, Crawford earned cash revenues of $46,000, paid cash expenses of $26,000, and paid a cash dividend to stockholders of $5,000. Crawford also acquired $15,000 of additional cash from the sale of common stock and paid $10,000 cash to reduce the liability owed to a bank. Required a.Prepare an income statement, statement of changes in stockholdersâ equity, period-end balance sheet, and statement of cash flows for the 2014 accounting period. (Hint: Determine the amount of beginning retained earnings before considering the effects of the current period events. It also might help to record all events under an accounting equation before preparing the statements.) b.Determine the percentage of total assets that were provided by creditors, investors, and earnings. c.Determine the balance in the Revenue, Expense, and Dividends accounts as of January 1, 2015. LO 1-2, 1-3, 1-4, 1-5, 1-6, 1-7 CHECK FIGURES a. Net Income: $19,000 e. Net Cash Flow from Operating Activities: $19,000
Problem 1-33Interrelationships among financial statements Crawford Enterprises started the 2014 accounting period with $75,000 of assets (all cash), $15,000 of liabilities, and $25,000 of common stock. During the year, Crawford earned cash revenues of $46,000, paid cash expenses of $26,000, and paid a cash dividend to stockholders of $5,000. Crawford also acquired $15,000 of additional cash from the sale of common stock and paid $10,000 cash to reduce the liability owed to a bank. Required a.Prepare an income statement, statement of changes in stockholdersâ equity, period-end balance sheet, and statement of cash flows for the 2014 accounting period. (Hint: Determine the amount of beginning retained earnings before considering the effects of the current period events. It also might help to record all events under an accounting equation before preparing the statements.) b.Determine the percentage of total assets that were provided by creditors, investors, and earnings. c.Determine the balance in the Revenue, Expense, and Dividends accounts as of January 1, 2015. LO 1-2, 1-3, 1-4, 1-5, 1-6, 1-7 CHECK FIGURES a. Net Income: $19,000 e. Net Cash Flow from Operating Activities: $19,000
Related questions
Susanâs Consulting experienced the following transactions for2014, its first year of operations, and 2015. Assume that alltransactions involve the receipt or payment of cash.
| Transactions for2014 |
| 1. | Acquired $65,000by issuing common stock. |
| 2. | Received$115,000 cash for providing services to customers. |
| 3. | Borrowed $18,000cash from creditors. |
| 4. | Paid expensesamounting to $57,000. |
| 5. | Purchased landfor $40,000 cash. |
| Transactions for2015 |
| Beginningaccount balances for 2015 are: |
| Cash | $ | 101,000 | |
| Land | 40,000 | ||
| Notes payable | 18,000 | ||
| Common stock | 65,000 | ||
| Retained earnings | 58,000 | ||
| 1. | Acquired anadditional $23,000 from the issue of common stock. |
| 2. | Received$133,000 for providing services. |
| 3. | Paid $13,000 tocreditors to reduce loan. |
| 4. | Paid expensesamounting to $72,000. |
| 5. | Paid a $13,500dividend to the stockholders. |
| 6. | Determined thatthe market value of the land is $50,000. |
| Required | |
| a. | Record the effects of each accounting event under theappropriate headings for each year. Record the amounts of revenue,expense, and dividends in the Retained Earnings column. Provideappropriate titles for these accounts in the last column of thetable. (Enter any decreases to account balances with aminus sign. Select "NA" if there is no effect on the "AccountTitles for Retained Earnings".) |
| b-1. | Prepare an income statement for each year accounting period. |
| b-2. | Prepare a statement of changes instockholdersâ equity for each year accounting period. |
| b-3. | Prepare a year-end balance sheet for eachyear accounting period. |
| b-4. | Prepare a statement of cash flows for eachyear accounting period. (Amounts to be deducted should beindicated with a minus sign.) |
| c. | Determine theamount of cash that is in the retained earnings account at the endof 2014 and 2015. |
| e. | Determine the balance in the Retained Earnings accountimmediately after Event 2 in 2014 and in 2015 are recorded. |
