Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for

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Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for its first year of operations:
Events Affecting Year 1:
1. Provided $84,000 of cleaning services on account.
2. Collected $76,000 cash from accounts receivable.
3. Paid salaries of $28,500 for the year.
4. Adjusted the accounts to reflect management’s expectations that uncollectible accounts expense would be $1,650. The expense was determined using the percent of revenue method.


Required
a. Organize the transaction data in accounts under an accounting equation.
b. Prepare an income statement, a balance sheet, and a statement of cash flows for Year 1.

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Related Book For  book-img-for-question

Introductory Financial Accounting for Business

ISBN: 978-1260299441

1st edition

Authors: Thomas Edmonds, Christopher Edmonds

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