Comparing Profit with Cash Flow (A Challenging Problem)

New Delivery Company was organized on January 1, 2012. At the end of the first quarter (three months) of operations, the owner prepared a summary of its operations as shown in the first row of the following tabulation:

Required:
1 For each of the six transactions given in this tabulation, enter what you consider to be the correct amounts. Enter a zero when appropriate. The first transaction is illustrated.
2 For each transaction, explain the basis for your responses.

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Summary of Transactions a. Services performed for customers, $66,000, of which one-sixth remained uncollected at the end of the quarter. b. Cash borrowed from the local bank, $30,000 (one-year note). c. Small service truck purchased for use in the business: cost, $9,000; paid 30% down, balance on credit. d. Expenses, $36,000, of which one-sixth remained unpaid at the end of the quarter. e. Service supplies purchased for use in the business, $3,000, of which one-fourth remained unpaid (on credit) at the and of the quarter. Also, one-fifth of these supplies were unused (still on hand) at the end of the quarter. f. Wages earned by employees, $21,000, of which one-half remained unpaid at the end of the quarter Based only on the above transactions, compute the following for the quarter: Profit (or loss) Cash inflow (or out low) Profit Cash $66,000 $55,000