Question

The following selected accounts and account balances were taken from the records of Potts Industries. Unfortunately they are all out of order. Except as otherwise indicated, all balances are as of December 31, 2017, before the closing entries were recorded:

Cash	$22,100	Accounts Receivable	$21,000
Land	43,000	Cash flow from operating activities	8,600
Insurance Expense	2,500	Beginning Retained Earnings	47,200
Dividends	5,000	Begining common stock	5,500
Prepaid Insurance	3,500	Service Revenue	86,000
Accounts Payable	15,000	Cash flow from financing activities	9,000
Supplies	2,100	Ending Common Stock	12,500
Supplies Expense	1,000	Cash Flow from investing activities	(6,000)
Rent Expense	3,500	Other Operating Expenses	59,000

Required:

Use the information in the table above to construct the A) Income Statement, B) Statement of Changes in Stockholders Equity, C) Balance Sheet, and D) Statement of Cash Flows (only show totals for each activity on the statement of cash flows)

Answer 1

POTTS INDUSTRIES
Income statement
for the year ended December31, 2017
Service Revenue	86000
Less:Expenses
Insurance Expense	2500
Suplies Expense	1000
Rent Expense	3500
Other Opertating Expense	59000
Total Expenses	66000
Net Income	20000

C.

	Common Stock	Retained Earnings	Total Stockholders' Equity
				Balance as at January 1, 2017	2500	47200	49700
New issue of capital	10000		10000
Net income for the year		20000	20000
Dividends Paid		-5000	-5000
Balance as at December 31, 2017	12500	62200	74700

D.

POTTS INDUSTRIES
Statement of cash flows
for the year ended December31, 2017
Cash flow from operating activities	8600
Cash flow from investing activities	-6000
Cash flow from financing activities	9000
Net Cash Flow	11600