$6.$ Life, Incorporated experienced the following events in Year $1,$ its first year of operation:

Performed counseling services for $$26,000$ cash.

On February $1,$ Year $1,$ paid $$18,000$ cash to rent office space for the coming year.

Adjusted the accounts to reflect the amount of rent used during the year.

Required

Based on this information alone:

a$.$ Record the events in general ledger accounts under an accounting equation.

b$.$ Prepare an income statement, balance sheet, and statement of cash flows for the Year $1$ accounting period.

c$.$ Ignoring all other future events, what is the amount of rent expense that would be recognized in Year $2?$

$7.$ Yard Designs $($YD$)$ experienced the following events in Year $1,$ its first year of operation:

On October $1,$ Year $1,$ YD collected $$38,400$ for consulting services it agreed to provide during the coming year.

Adjusted the accounts to reflect the amount of consulting service revenue recognized in Year $1.$

Required

Based on this information alone:

a$.$ Record the events under an accounting equation.

b$.$ Prepare an income statement, balance sheet, and statement of cash flows for the Year $1$ accounting period.

c$.$ Ignoring all other future events, what is the amount of service revenue that would be recognized in Year $2?$

$8.$ Hart, Attorney at Law, experienced the following transactions in Year $1,$ the first year of operations:

Accepted $$15,900$ on April $1,$ Year $1,$ as a retainer for services to be performed evenly over the next $12$ months.

Performed legal services for cash of $$66,000.$

Purchased $$1,350$ of office supplies on account.

Paid $$1,215$ of the amount due on accounts payable.

Paid a cash dividend to the stockholders of $$4,900.$

Paid cash for operating expenses of $$21,500.$

Determined that at the end of the accounting period $$100$ of office supplies remained on hand.

On December $31,$ Year $1,$ recognized the revenue that had been earned for services performed in accordance with Transaction $1.$

Required

Show the effects of the events on the financial statements using the following horizontal statements model. In the Cash Flow column, use the initials OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for net change in cash. If the element is not affected by the event, leave the cell blank. The first event has been recorded as an example. $($Do not round intermediate calculations. Enter any decreases to account balances and cash outflows with a minus sign. Not all cells require entry.$)$

$9.$ The following events apply to Tracey$$s Restaurant for the Year $1$ fiscal year:

Started the company when it acquired $$33,000$ cash from the issue of common stock.

Purchased a new cooktop that cost $$32,000$ cash.

Earned $$46,000$ in cash revenue.

Paid $$30,000$ cash for salaries expense.

Paid $$8,400$ cash for operating expenses.

Adjusted the records to reflect the use of the cooktop. The cooktop, purchased on January $1,$ Year $1,$ has an expected useful life of five years and an estimated salvage value of $$4,000.$ Use straight$-$line depreciation. The adjusting entry was made as of December $31,$ Year $1.$

Required

Record the events in general ledger accounts under an accounting equation.

What amount of depreciation expense would Tracey$$s report on the Year $2$ income statement?

What amount of accumulated depreciation would Tracey$$s report on the December $31,$ Year $2,$ balance sheet?

Would the cash flow from operating activities be affected by depreciation in Year $2?$

$10.$ In Year $1,$ Lee Incorporated billed its customers $$56,300$ for services performed. The company collected $$41,700$ of the amount billed. Lee incurred $$37,400$ of other operating expenses on account. Lee paid $$23,400$ of the accounts payable. Lee acquired $$25,000$ cash from the issue of common stock. The company invested $$19,000$ cash in the purchase of land.

Required

$($Hint: Identify the six events described in the paragraph and record them in general ledger accounts under an accounting equation before attempting to answer the questions.$)$ Use the preceding information to answer the following questions.

a$.$ What amount of revenue will Lee report on the Year $1$ income statement?

b$.$ What amount of cash flow from revenue will be reported on the statement of cash flows?

c$.$ What is the net income for the period?

d$.$ What is the net cash flow from operating activities for the period?

f$.$ What is the amount of net cash flow from investing activities?

g$.$ What is the amount of net cash flow from financing activities?

h$.$ What amounts of total assets, liabilities, and equity will be reported on the year$-$end balance sheet?