Data for SLO Healthcare for January are provided in problems 3-1, 3-2, and 3-3.
1. Prepare a stament of cash flows for January.
2. (Appendix) Reconcile the net cash flows from operating activities with the net income for January. (hint see the appendix to this chapter and use adjusted balamces in computing increases ans decreases in accounts.)
P3-1 Accrual basis of accounting SLO Health Care Inc. is owned and operated by Morgan Denby, the sole stockholder. During January 20Y6, SLO Health Care entered into the following transactions: Jan. 1 Received $13,500 from Glenn Company as rent for the use of a vacant office in SLO Health Care's building. Glenn paid the rent nine months in advance. 1 Paid $3,000 for a one-year general insurance business policy. 6 Purchased supplies of $900 on account. 9 Collected $16,000 for services provided to customers on account. 11 Paid creditors $2,500 on account. 18 Invested an additional $5,000 in the business in exchange for common stock. 20 Billed patients $26,000 for services provided on account. 25 Received $7,500 for services provided to customers who paid cash. 30 Paid expenses as follows: wages, $15,500 utilities, $4,250 rent on medical equipment, $2,650 interest, $100 and miscellaneous, $1,500. 30 Paid dividends of $4,000 to stockholder (Dr. Denby). P3-2 Adjustment process Adjustment data for SLO Health Care Inc. for January are as follows: 1. Insurance expired, $450. 2. Supplies on hand on January 31,$600. 3. Depreciation on building, $1,150. 4. Unearned rent revenue earned, \$1,500. 5. Wages owed employees but not paid, $1,450. 6. Services provided but not billed to patients, $2,500. Instructions Based on the transactions recorded in January for Problem 3-1, record the adjustments for January using the integrated financial statement framework. Enter the net income under Income Statement column after recording all the adjustments. P3-4 Statement of cash flows Data for SLO Health Care for January are provided in Problems 3-1, 3-2, and 3-3. Instructions 1. Prepare a statement of cash flows for January. 2. (Appendix) Reconcile the net cash flows from operating activities with the net income for January. (Hint: See the appendix to this chapter and use adjusted balances in computing increases and decreases in accounts.) P3-1 Accrual basis of accounting SLO Health Care Inc. is owned and operated by Morgan Denby, the sole stockholder. During January 20Y6, SLO Health Care entered into the following transactions: Jan. 1 Received $13,500 from Glenn Company as rent for the use of a vacant office in SLO Health Care's building. Glenn paid the rent nine months in advance. 1 Paid $3,000 for a one-year general insurance business policy. 6 Purchased supplies of $900 on account. 9 Collected $16,000 for services provided to customers on account. 11 Paid creditors $2,500 on account. 18 Invested an additional $5,000 in the business in exchange for common stock. 20 Billed patients $26,000 for services provided on account. 25 Received $7,500 for services provided to customers who paid cash. 30 Paid expenses as follows: wages, $15,500 utilities, $4,250 rent on medical equipment, $2,650 interest, $100 and miscellaneous, $1,500. 30 Paid dividends of $4,000 to stockholder (Dr. Denby). P3-2 Adjustment process Adjustment data for SLO Health Care Inc. for January are as follows: 1. Insurance expired, $450. 2. Supplies on hand on January 31,$600. 3. Depreciation on building, $1,150. 4. Unearned rent revenue earned, \$1,500. 5. Wages owed employees but not paid, $1,450. 6. Services provided but not billed to patients, $2,500. Instructions Based on the transactions recorded in January for Problem 3-1, record the adjustments for January using the integrated financial statement framework. Enter the net income under Income Statement column after recording all the adjustments. P3-4 Statement of cash flows Data for SLO Health Care for January are provided in Problems 3-1, 3-2, and 3-3. Instructions 1. Prepare a statement of cash flows for January. 2. (Appendix) Reconcile the net cash flows from operating activities with the net income for January. (Hint: See the appendix to this chapter and use adjusted balances in computing increases and decreases in accounts.)
