Problem 1-2A (Continued)
Part 3
Company C
First, calculate the beginning balance of equity:
Dec. 31, 2014
Assets …………………………………………………. $24,000
Liabilities …………………………………………….. ( 9,000)
Equity………………………………………………….. $15,000
Next, find the ending balance of equity by completing this table:
Finally, find the ending amount of assets by adding the ending balance of
Part 4
Company D
First, calculate the beginning and ending equity balances:
12/31/2014 12/31/2015
Problem 1-2A (Concluded)
Part 5
Company E
First, compute the balance of equity as of December 31, 2015:
Assets …………………………………………………. $113,000
Liabilities …………………………………………….. (70,000)
Problem 1-3A (15 minutes)
Armani Company
Balance Sheet
December 31, 2015
Problem 1-4A (15 minutes)
Edison Energy Company
Income Statement
For Year Ended December 31, 2015
Problem 1-5A (15 minutes)
Kojo Company
Statement of Retained Earnings
For Year Ended December 31, 2015
Problem 1-6A (15 minutes)
Kia Company
Statement of Cash Flows
For Year Ended December 31, 2015
Cash from operating activities …………………… $ 6,000
Problem 1-7A (60 minutes) Parts 1 and 2
Assets = Liabilities + Equity
Date
Cash
+
Accounts
Receivable
Office
Equipment
=
Accounts
Payable
+
Common
Stock
–
Dividends
+
Revenues
–
Expenses
May
1
+$40,000
=
+
$40,000
1
– 2,200
=
–
$2,200
3
$1,890
=
+ $1,890
5
– 750
`
=
–
750
8
+ 5,400
=
+
$5,400
12
+
$2,500
=
+
2,500
15
– 750
=
–
750
20
+ 2,500
–
2,500
=
22
+
3,200
=
+
3,200
25
+ 3,200
–
3,200
=
26
– 1,890
=
– 1,890
27
=
+ 80
–
80
28
– 750
=
–
750
30
– 300
=
–
300
30
– 280
=
–
280
31
– 1,400
=
–
$1,400
$42,780
+
$ 0
$1,890
=
$ 80
+
$40,000
–
$1,400
+
$11,100
–
$5,110
Problem 1-7A (Continued)
Part 3
The Gram Co.
Income Statement
For Month Ended May 31
Revenues
Consulting services revenue ………… $11,100
Expenses
Rent expense…………………………..……. $2,200
The Gram Co.
Statement of Retained Earnings
For Month Ended May 31
The Gram Co.
Balance Sheet
May 31
Assets Liabilities
Cash ………………………….$42,780 Accounts payable …………………… $ 80
Problem 1-7A (Concluded)
Part 3—continued
The Gram Co.
Statement of Cash Flows
For Month Ended May 31
Cash flows from operating activities
Cash received from customers …………………………..
$11,100
Cash paid for rent …………………………..………………….
(2,200)
Cash paid for cleaning ……………………………………….
(750)
Cash paid for telephone …………………………..…………
(300)
Cash paid for utilities …………………………………………
(280)
Cash paid to employees …………………………………….
(1,500)
Net cash provided by operating activities …………..
$ 6,070
Cash flows from investing activities
Purchase of equipment ………………………………………
(1,890)
Net cash used by investing activities ………………….
(1,890)
Cash flows from financing activities
Investment from stockholders …………………………...
40,000
Cash dividends ………………………………………………….
(1,400)
Net cash provided by financing activities ……………
38,600
Net increase in cash …………………………………………..
$42,780
Cash balance, May 1 ………………………………………….
0
Cash balance, May 31 ………………………………………..
$42,780
Problem 1-8A (60 minutes) Parts 1 and 2
Assets
=
Liabilities
+
Equity
Cash
+
Accounts
Receivable
+
Office
Supplies
+
Office
Equipment
+
Building
=
Accounts
Payable
+
Notes
Payable
+
Common
Stock
–
Dividends
+
Reve–
nues
–
Expen-
ses
a.
+$70,000
+
$10,000
+
$80,000
b.
– 20,000
+
$150,000
+
$130,000
Bal.
50,000
+
10,000
+
150,000
=
+
130,000
+
80,000
c.
– 15,000
+
15,000
Bal.
35,000
+
25,000
+
150,000
=
+
130,000
+
80,000
d.
+
$1,200
+
1,700
+ $2,900
Bal.
35,000
+
1,200
+
26,700
+
150,000
=
2,900
+
130,000
+
80,000
e.
– 500
–
$ 500
Bal.
34,500
+
1,200
+
26,700
+
150,000
=
2,900
+
130,000
+
80,000
–
500
f.
+
$2,800
+
$2,800
Bal.
34,500
+
2,800
+
1,200
+
26,700
+
150,000
=
2,900
+
130,000
+
80,000
+
2,800
–
500
g.
+ 4,000
+
4,000
Bal.
38,500
+
2,800
+
1,200
+
26,700
+
150,000
=
2,900
+
130,000
+
80,000
+
6,800
–
500
h.
– 3,275
–
$3,275
Bal.
35,225
+
2,800
+
1,200
+
26,700
+
150,000
=
2,900
+
130,000
+
80,000
–
3,275
+
6,800
–
500
i.
+ 1,800
–
1,800
Bal.
37,025
+
1,000
+
1,200
+
26,700
+
150,000
=
2,900
+
130,000
+
80,000
–
3,275
+
6,800
–
500
j.
– 700
– 700
Bal.
36,325
+
1,000
+
1,200
+
26,700
+
150,000
=
2,200
+
130,000
+
80,000
–
3,275
+
6,800
–
500
k.
– 1,800
–
1,800
Bal.
$34,525
+
$1,000
+
$1,200
+
$26,700
+
$150,000
=
$2,200
+
$130,000
+
$80,000
–
$3,275
+
$6,800
–
$2,300
Problem 1-8A (Concluded)
Part 3
Problem 1-9A (60 minutes) Parts 1 and 2
Assets
=
Liabilities
+
Equity
Date
Cash
+
Accounts
Receivable
+
Office
Supplies
+
Office
Equipment
+
Electrical
Equipment
=
Accounts
Payable
+
Common
Stock
–
Dividends
+
Revenues
–
Expenses
Dec.
1
+$65,000
=
+
$65,000
2
– 1,000
–
$1,000
Bal.
64,000
=
65,000
–
1,000
3
– 4,800
+
$13,000
+ $8,200
Bal.
59,200
+
13,000
=
8,200
+
65,000
–
1,000
5
– 800
+
$ 800
Bal.
58,400
+
800
+
13,000
=
8,200
+
65,000
–
1,000
6
+ 1,200
+
$1,200
Bal.
59,600
+
800
+
13,000
=
8,200
+
65,000
+
1,200
–
1,000
8
+
$2,530
+ 2,530
Bal.
59,600
+
800
+
2,530
+
13,000
=
10,730
+
65,000
+
1,200
–
1,000
15
+
$5,000
+
5,000
Bal.
59,600
+
5,000
+
800
+
2,530
+
13,000
=
10,730
+
65,000
+
6,200
–
1,000
18
+
350
+ 350
Bal.
59,600
+
5,000
+
1,150
+
2,530
+
13,000
=
11,080
+
65,000
+
6,200
–
1,000
20
– 2,530
– 2,530
Bal.
57,070
+
5,000
+
1,150
+
2,530
+
13,000
=
8,550
+
65,000
+
6,200
–
1,000
24
+
900
+
900
Bal.
57,070
+
5,900
+
1,150
+
2,530
+
13,000
=
8,550
+
65,000
+
7,100
–
1,000
28
+ 5,000
–
5,000
Bal.
62,070
+
900
+
1,150
+
2,530
+
13,000
=
8,550
+
65,000
+
7,100
–
1,000
29
– 1,400
–
1,400
Bal.
60,670
+
900
+
1,150
+
2,530
+
13,000
=
8,550
+
65,000
+
7,100
–
2,400
30
– 540
–
540
Bal.
60,130
+
900
+
1,150
+
2,530
+
13,000
=
8,550
+
65,000
+
7,100
–
2,940
31
– 950
–
$950
Bal.
$59,180
+
$ 900
+
$1,150
+
$2,530
+
$13,000
=
$8,550
+
$65,000
–
$950
+
$7,100
–
$2,940