Exercise 11-2A (Algo) Effect of accounting events on the financial statements of a sole proprietorship LO 11-1 A sole proprietorship was started on January 1 Year 1 when it received $60,500 cash from Marlin Jones, the owner. During Year 1, the company earned $49.400 in cash revenues and paid $21,340 in cash expenses. Jones withdrew $6,700 cash from the business during Year 1 Required Prepare an income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows for Jones's Year 1 fiscal year (For Statement of Cash Flows only, indicate amounts to be deducted and cash outflows with a minus sign) MARLIN JONES SOLE PROPRIETORSHIP Income Statement for the Year Ended December 31, Year $ 0 MARLIN JONES SOLE PROPRIETORSHIP Capital Statement For the Year Ended Decomber 31, Year 1 Beginning capital balance Ending capital balance $ MARLIN JONES SOLE PROPRIETORSHIP Balance Sheet As of December 31, Year 1 Assets Total assets Liabilities Equity $ Total liabilities and equity MARLIN JONES SOLE PROPRIETORSHIP Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: $ $ 0 Net cash flow from operating activities Cash flows from investing activities $ 0 Net cash flow from investing activities Cash flows from financing activities 0 Net cash flow from financing activities Net change in cash 0 $ $ 0 Ending cash balance Exercise 11-6A (Algo) Accounting for cumulative preferred dividends LO 11-3 When Crossett Corporation was organized in January, Year 1, it immediately issued 4,200 shares of $47 por, 5 percent, cumulative preferred stock and 9,500 shares of $8 par common stock. Its earnings history is as follows: Year 1, net loss of $12,200; Year 2, net income of $103,000; Year 3, net income of $117.000. The corporation did not pay a dividend in Year 1. Required a. How much is the dividend arrearage as of January 1. Year 2? Dividend arrearage b. Assume that the board of directors declares a $34.240 cash dividend at the end of Year 2 (remember that the Year 1 and Year 2 preferred dividends are due). How will the dividend be divided between the preferred and common stockholders? Total amount distributed to preferred shares Total amount distributed to common shares