At the beginning of Year 2, Oak Consulting had the following normal balances in its accounts:

Account	Balance
Cash	$	42,000
Accounts receivable		25,000
Accounts payable		8,400
Common stock		24,000
Retained earnings		34,600

The following events apply to Oak Consulting for Year 2:

1. Provided $185,000 of services on account.
2. Incurred $45,800 of operating expenses on account.
3. Collected $140,000 of accounts receivable.
4. Paid $120,000 cash for salaries expense.
5. Paid $31,400 cash as a partial payment on accounts payable.
6. Paid a $10,000 cash dividend to the stockholders.

c. Show the effect of above adjustment in a horizontal statements model

Answer is not complete. Net Income OAK CONSULTING Effect of Transactions on the Financial Statements for Year 2 Balance Sheet Income Statement Liabilities Stockholders' Equity Revenue - Expenses Accounts Common Retained Payable Stock Earnings 8,400 + 24,000 + 34,600 185,000 185,000 45,800 45,800 = Statement of Cash Flows No Assets Accounts Receivable + 25,000 185,000 Cash 42,000 Bal. = + + 185,000 (45,800) + + (140,000) + + + + 140,000 (120,000) (31,400) (10,000) 20,600 = = (31,400) X + (120,000) (31400) (10,000) 89,600 + + + 120,000 31400 10000 207,200 140,000 (120,000) (31,400) (10,000) (21,400) (120,000) - 31400 -10000 (22,200) OA OA OA FA NC 6 + + Bal. 70,000 = 22,800 + 24,000 185,000 - =