During the first year of operation, Year 1, Direct Service Company recognized $370,000 of service revenue on account. At the end of Year 1, the accounts receivable balance was $65,000. For this first year in business, the owner believes uncollectible accounts expense will be about 2 percent of sales on account.

d. Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). Complete this question by entering your answers in the tabs below. Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specific the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (F, Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. a. What amount of cash did Direct Service collect from accounts receivable during Ye b. Assuming Direct Service uses the allowance method to account for uncollectible ac Service record as uncollectible accounts expense for Year 1 ? c. What is the net realizable value of receivables at the end of Year 1