Question

Timber Ridge, Inc. was started on January 1, Year. The following events apply to the company’s...

Timber Ridge, Inc. was started on January 1, Year. The following events apply to the company’s first year of operation.

1. On January 1 issued 3,000 shares of $1 par value common stock at a market price of $10 per share.

2. Purchased 500 shares of Timber Ridge stock (treasury stock) at a price of $10 per share on February 1.

3. Sold 200 (reissued) shares of the treasury stock at a price of $13 per share on March 15.

4. Earned $15,000 cash revenue.

5. Accrued $8,000 of expenses

6. On August 1 declared a cash dividend of $1 per share. The dividends will be paid on August 31 to the shareholders of record on August 15.

7. Shareholders of record recorded.

8. Paid the dividends declared in 6.

Show the impact of these events on the horizontal financial statement model, + = increase, - = decrease, NA = no change

Event

Assets =

Liab.     +

Equity

Revenues

Minus Expenses

= Net Income

Statement of Cash Flows

1

2

3

4

5

6

7

8
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