Che 9 Chapter 04 Comprehensive Problem (Pg 271) JFZ NOTE: Pacilio, Inc. is starting its 4th Year in Business. 6 points The trial balance of Pacilio Security Services, Inc. as of January.1. Year 4, had the following normal balances: eBook Print Cash Accounts Receivable Supplies Prepaid Rent Land Unearned Tevenue Salaries Payable Connon stock Retained Earnings $12.500 3,500 120 1,000 4,000 900 1,000 8,000 11,220 In Year 4, Paclio Security Services decided to expand its business to sell security systems and offer 24-hour alarm monitoring services. It plans to phase out its current service of providing security personnel at various events. The following summary transactions occurred during Year 4 9 6 points eBook Print 1. Pald the salaries payable from Year 3. 2. Acquired an additional $42,000 cash from the issue of common stock. 3. Rented a larger building on May 1: paid $6,000 for 12 months' rent in advance. 4. Pald $800 cash for supplies to be used over the next several months by the business. 5. Purchased alarm systems for resale at a cost of $12,000. The alarm systems were purchased on account with the terms 2/10, 1/30 6. Returned alarm systems that had a cost of $240. 7. Installed alarm systems during the year for a total sales amount of $20,000. Sales of $15,000 were on account, while $5,000 were cash sales. 8. The cost of the systems sold in Event 7 amounted to $9,440. 9. Pald the installers and other employees a total of $9,500 in salaries. 10. Sold $36,000 of monitoring services for the year. The services are billed to the customers each month. 11. Pald cash on accounts payable. The payment was made before the discount period expired. At the time of purchase, the inventory has a cost of $8,000 and was purchased under the terms 2/10, 1/30. 12. Pald cash to settle additional accounts payable in the amount of $2,780. The payment was made after the discount period expired. 13. Collected $43,000 of accounts receivable during the year 14. Performed $12,000 of security services for area events: $9,000 was on account and $300 was for cash 15. Pald advertising cost of $1,620 for the year. 16. Pald $1,100 for utilities expense for the year. 17. Pald a dividend of $12,000 to the shareholders. Adjustment Information 18. Supplies of $150 were on hand at the end of the year, 19. Recognized the expired rent for the year. 20. Recognized the balance of the unearned revenue; cash was received in Year 3. 21. Accrued salaries at December 31, Year 4, were $1,500. mius sign.) 9 Pacilio Security Services, Inc. Statement of Cash Flows For the Year Ended December 31, Year 4 Cash flows from operating activities: Cash receipts from customers 6 points eBook Print $ 0 Net cash flow from operating activities Cash flows from investing activities: Net cash flow from investing activities Cash flows from financing activities: Cash payments for dividends Net cash flow from financing activities Net increase in cash Add: Beginning cash balance Ending cash balance $