Question

Problem 3-28A Effect of journal entries on financial statements LO 3-2 Event No. Account Title Debit...

Problem 3-28A Effect of journal entries on financial statements LO 3-2

Event
No. Account Title Debit Credit
1 Cash xxx
Common stock xxx
2 Prepaid Rent xxx
Cash xxx
3 Accounts Receivable xxx
Service Revenue xxx
4 Cash xxx
Unearned Revenue xxx
5 Cash xxx
Accounts Receivable xxx
6 Supplies xxx
Accounts Payable xxx
7 Salaries Expense xxx
Cash xxx
8 Utilities Expense xxx
Cash xxx
9 Supplies Expense xxx
Supplies xxx
10 Unearned revenue xxx
Service revenue xxx
11 Cash xxx
Service Revenue xxx
12 Dividends xxx
Cash xxx
13 Rent Expense xxx
Prepaid Rent xxx


Required
The preceding 13 different accounting events are presented in general journal format. Use a horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. Indicate whether the event increases (+), decreases (−), or does not affect (NA) each element of the financial statements. Also, in the Cash Flow column, use the letters OA to designate operating activity, IA for investing activity, and FA for financing activity. The first event is recorded as an example.
  

Homework Answers

Answer #1

Answer

Event Assets = Liability + Equity Revenue - Expenses Net Income Cash Flow
1 + NA + NA NA NA FA
2 + & - NA NA NA NA NA -OA
3 + NA + + NA + NA
4 + + NA NA NA NA OA
5 + & - NA NA NA NA NA OA
6 NA + - NA + - NA
7 - NA - NA + - -OA
8 - NA - NA + - -OA
9 NA NA NA NA + & - +& - NA
10 NA - + + NA + NA
11 + NA + + NA + OA
12 - NA - NA NA NA - FA
13 - NA - NA + - NA

FA = Financial Activities

OA = Operating Activities

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