Clark Bell started a personal financial planning business when he accepted $65,000 cash as advance payment for managing the financial assets of a large estate. Bell agreed to manage the estate for a one-year period beginning June 1, 2018.

Required

a. Show the effects of the advance payment and revenue recognition on the 2018 financial statements using a horizontal statements model like the following one. In the Cash Flows column, use OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for net change in cash. Use NA if the account is not affected.

b. How much revenue would Bell recognize on the 2019 income statement?

c. What is the amount of cash flow from operating activities in 2019?

b. Revenue to be recognized in 2019:

c. Amount of cash flow from operating activities:

BELL PERSONAL FINANCIAL PLANNING Horizontal Statements Model for 2018 AssetsLiabilities Stockholders Cash-Unearned Income Statement Equ Retained Earnings Statement of Cash Flow ined Reven Event ash Revenue RevenueExpense Net Income 65.0001 = 65,000+ OA 1. Advance payment 2. Revenue earned Totals 65.0001 = 65,000 +