Leach Inc. experienced the following events for the first two years of its operations: 2018: 1. Issued

Question:

Leach Inc. experienced the following events for the first two years of its operations:

2018:

1. Issued $10,000 of common stock for cash.

2. Provided $78,000 of services on account.

3. Provided $36,000 of services and received cash.

4. Collected $69,000 cash from accounts receivable.

5. Paid $38,000 of salaries expense for the year.

6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.

2019:

1. Wrote off an uncollectible account for $650.

2. Provided $88,000 of services on account.

3. Provided $32,000 of services and collected cash.

4. Collected $81,000 cash from accounts receivable.

5. Paid $65,000 of salaries expense for the year.

6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.

Required

a. Organize the transaction data in accounts under an accounting equation.

b. Prepare the income statement, statement of changes in stockholders' equity, balance sheet, and statement of cash flows for 2018.

c. What is the net realizable value of the accounts receivable at December 31, 2018?

d. Repeat Requirements a, b, and c for 2019.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...