Cooley Company was started on January 1, 2011, and experienced the following events during its first year

Question:

Cooley Company was started on January 1, 2011, and experienced the following events during its first year of operation.
1. Acquired $\$ 30,000$ cash from the issue of common stock.
2. Borrowed $\$ 40,000$ cash from National Bank.
3. Earned cash revenues of $\$ 48,000$ for performing services.

4. Paid cash expenses of $\$ 45,000$.
5. Paid a $\$ 1,000$ cash dividend to the stockholders.
6. Acquired an additional $\$ 20,000$ cash from the issue of common stock.
7. Paid $\$ 10,000$ cash to reduce the principal balance of the bank note.
8. Paid $\$ 53,000$ cash to purchase land.
9. Determined that the market value of the land is $\$ 75,000$.
Required

a. Record the preceding transactions in the horizontal statements model. Also, in the Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). The first event is shown as an example.

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b. Determine the amount of total assets that Cooley would report on the December 31, 2011, balance sheet.

c. Identify the asset source transactions and related amounts for 2011.

d. Determine the net income that Cooley would report on the 2011 income statement. Explain why dividends do not appear on the income statement.

e. Determine the net cash flows from operating activities, financing activities, and investing activities that Cooley would report on the 2011 statement of cash flows.

f. Determine the percentage of assets that were provided by investors, creditors, and earnings.
g. What is the balance in the Retained Earnings account immediately after Event 3 is recorded?

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