Business, 20.02.2020 23:30 asims13

Life, Inc. experienced the following events in Year 1, its first year of operation: 1. Performed counseling services for $20,400 cash. 2. On February 1, Year 1, paid $13,800 cash to rent office space for the coming year. 3. Adjusted the accounts to reflect the amount of rent used during the year. Required:

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 accounting period.
c. Ignoring all other future events, what is the amount of rent expense that would be recognized in nex year?

Answers: 3

Show answers

Answers

Answer from: tevaughn06

Accounting Equation

Event Assets = Equity + Liability

1. Services +$20,400 +$20,400

2. Rent Payment -$13,800

+$13,800

3. Adjustment -$12,650 -$12,650

Income Statement

Revenue $20,400

Expenses $12,650

Net Income $7,750

Balance Sheet

Assets

Prepaid Rent $1,150

Cash $6,600

Total Assets $7,750

Equity and Liability

Equity (Retained Earning) $7,750

Liabilities $0

Total Assets $7,750

Statement of cash flow

Cash flow from Operating activities

Net profit $7,750

Increase in receivable ($1,150)

Net Operating Cash flow $6,600

Net Investing Cash flow $0,000

Net Financing Cash flow $0,000

Total Net cash flow $6,600

Opening cash balance $0,000

Closing cash balance $6,600

Year 1 Rent Expense = $13,800 x ( 11 / 12 ) = 12,650

Rent Expense Expense to recognized next year = Prepaid Rent = $1,150

Explanation:

* Year end is December 31, Year 1

As 11 months passed from February 1, Year 1 and expense of these months has been accrued, so only one months rent remains prepaid.

Prepaid rent = $13,800 - $12650 = $1,150

Cash = $20,400 - 13,800 = $6,600

Answer from: Quest

mauve company permits employees to occasionally use the copying machine for personal purposes

Answer from: Quest

the answer is true. i do believe this is the answer because of the amount of wrecks people get into each year. if you double this with avoiding those so said wrecks, that would make you a "skilled" driver.

Another question on Business

Business, 22.06.2019 05:00

Ajewelry direct sales company pays its consultants based on recruiting new members. question 1 options: the company is running a pyramid scheme, which is illegal. the company is running a pyramid scheme, which is legal. the company has implemented a legal and ethical plan for growth. the company uses this method of compensation to reduce the fee for the product sample kit.

Answers: 3

Answer

Business, 22.06.2019 10:40

Why do you think the compensation plans differ at the two firms? in particular, why do you think kaufmann’s pays commissions to salespeople, while parkleigh does not? why does parkleigh offer employees discounts on purchases, while kaufmann’s does not?

Answers: 3

Answer

Business, 22.06.2019 12:40

When cell phones were first entering the market, they were relatively large and reception was undependable. all cell phones were essentially the same. but as the technology developed, many competitors entered, introducing features unique to their phones. today, cell phones are only a small fraction of the size and weight of their predecessors. consumers can buy cell phones with color screens, cameras, internet access, daily planners, or voice activation (and any combination of these features). the history of the cell phone demonstrates what marketing trend?

Answers: 3

Answer

Business, 22.06.2019 13:20

In order to be thoughtful about the implementation of security policies and controls, leaders must balance the need to reduce with the impact to the business operations. doing so could mean phasing security controls in over time or be as simple as aligning security implementation with the business’s training events.

Answers: 3

Answer

You know the right answer?

Life, Inc. experienced the following events in Year 1, its first year of operation: 1. Performed cou...

Questions