E3-26A. (Learning Objective 4: Reporting on the financial statements) This question deals with the items and the amounts that two entities, Mother Catherine Hospital (Mother Catherine)

and City of Cologne (Cologne), should report in their financial statements. Fill in the blanks.

Requirements 1. On July 1, 20X6, Mother Catherine collected $6,000 in advance from Cologne, a client.

Under the contract, Mother Catherine is obligated to perform medical exams for City of Cologne employees evenly during the 12 months ending June 30, 20X7. Assume you are Mother Catherine.

Mother Catherine’s Income Statement for the year ended December 31, 20X6, will report _____ of $ _____.

Mother Catherine’s Balance Sheet at December 31, 20X6, will report _____ of $ _____.

2. Cologne’s Income Statement for the year ended December 31, 20X6, will report _____ of

$ _____.

Cologne’s Balance Sheet at December 31, 20X6, will report _____ of $ _____.