During 2016 Pacilio Security Services experienced the following transactions:

1.

Paid the salaries payable from 2015.

2.

On March 1, 2016, Pacilio established a $100 petty cash fund to handle small expenditures.

3.

Paid $4,800 on March 1, 2016, for one years lease on the company van in advance.

4.

Paid $7,200 on May 2, 2016, for one years office rent in advance.

5.

Purchased $400 of supplies on account.

6.

Purchased 100 alarm systems for $28,000 cash during the year.

7.

Sold 102 alarm systems for $57,120. All sales were on account. (Compute cost of goods sold using the FIFO cost flow method.)

8.

Paid $2,100 on accounts payable during the year.

10.

Billed $52,000 of monitoring services for the year.

11.

Paid installers and other employees a total of $25,000 cash for salaries.

12.

Collected $89,300 of accounts receivable during the year.

13.

Paid $3,600 of advertising expense during the year.

14.

Paid $2,500 of utilities expense for the year.

15.

Paid a dividend of $10,000 to the shareholders.

Adjustment

16.

There was $160 of supplies on hand at the end of the year.

17.

Recognized the expired rent for both the van and the office building for the year. (The rent for both the van and the office remained the same for 2015 and 2016.)

18.

Recognized the balance of the revenue earned in 2016 where cash had been collected in 2015.

19.

Accrued salaries at December 31, 2016, were $1,400.

The following information is available for the bank reconciliation:

(1)

Checks written but not paid by the bank, $8,350.

(2)

A deposit of $6,500 made on December 31, 2016, had been recorded but was not shown on the bank statement.

(3)

A debit memo for $55 for a new supply of checks. (Hint: Use Office Supplies Expense account.)

(4)

A credit memo for $30 for interest earned on the checking account.

(5)

An NSF check for $120.

The balance shown on the bank statement was $80,822.

Indicate whether the transaction increases (+), decreases (), or increases and decreases (+/-) for each element of the financial statements. Also, in the Cash Flow column, use the letters OA to designate operating activity, IA for investing activity, FA for financing activity. The first transaction is recorded as an example.

Pacilio Security Services, Inc.
Effect of Transactions on Financial Statements - 2016
Transaction	Balance Sheet					Income Statement					Statement of Cash Flows
	Assets	=	Liabilities	+	S. Equity	Revenue		Expenses	=	Net Income
1.												OA
2.	-		+		+							OA
3.
4.
5.
6.
7a.
7b.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20a.
20b.