Question

Transactions Using Accrual Accounting

Terry Mason organized The Fifth Season at the beginning of February 20Y4. During February, The Fifth Season entered into the following transactions:

Terry Mason invested $15,000 in The Fifth Season in exchange for common stock.

Paid $2,700 on February 1 for an insurance premium on a 1-year policy.

Purchased supplies on account, $900.

Received fees of $28,500 during February

Paid expenses as follows: wages, $10,800; rent, $3,200; utilities, $1,400; and miscellaneous, $1,600.

Paid dividends of $4,000.

Record the preceding transactions using the integrated financial statement framework. After each transaction, enter a balance for each item. If an amount box does not require an entry, leave it blank. Enter account decreases and net cash outflows as negative amounts.

Statement of Cash Flows

Balance Sheet

Assets

=

Liabilities

+

Stockholders' Equity

+

+

=

+

+

a.

b.

Balances

c.

Balances

d.

Balances

e.

Balances

f.

Balances

Statement of Cash Flows

Income Statement

a.

$

d.

$

b.

e.

d.

e.

e.

e.

f.

e.

$

$

Answer 1