Financial Statements

The transactions and integrated financial statement framework for Terry Mason for February 20Y4 appear below:

Terry Mason organized The Fifth Season at the beginning of February 20Y4. During February, The Fifth Season entered into the following transactions:

1. Terry Mason invested $27,375 in The Fifth Season in exchange for capital stock.
2. Paid $5,250 on February 1 for an insurance premium on a 1-year policy.
3. Purchased supplies on account, $1,920.
4. Received fees of $61,645 during February.
5. Paid expenses as follows: wages, $15,000; rent, $2,500; utilities, $1,250; and miscellaneous, $1,375.
6. Paid dividends of $7,770.

There was $1,056 of supplies on hand as of February 28.

Statement of Cash Flows	Balance Sheet
	Assets					=	Liabilities	+	Stockholders' Equity
	Cash	+	Supplies	+	Prepaid Insurance	=	Accounts Payable	+	Common Stock	+	Retained Earnings
a. Investment	27,375								27,375
b. Paid insurance	5,250				5,250
Balances	22,125				5,250				27,375
c. Purchased supplies			1,920				1,920
Balances	22,125		1,920		5,250		1,920		27,375
d. Fees earned	61,645										61,645
Balances	83,770		1,920		5,250		1,920		27,375		61,645
e. Paid expenses	20,125										20,125
Balances	63,645		1,920		5,250		1,920		27,375		41,520
f. Paid dividends	-7,770										-7,770
Balances	55,875		1,920		5,250		1,920		27,375		33,750
a1. Insurance expense					-438						-438
Balances	55,875		1,920		4,812		1,920		27,375		33,312
a2. Supplies expense			-864								-864
Balances, February 28	55,875		1,056		4,812		1,920		27,375		32,448
Statement of Cash Flows									Income Statement
a. Financing	$27,375								d. Fees earned			$61,645
b. Operating	-5,250								e. Wages expense			-15,000
d. Operating	61,645								e. Rent expense			-2,500
e. Operating	-20,125								e. Utilities expense			-1,250
f. Financing	-7,770								e. Miscellaneous expense			-1,375
Increase in cash	$55,875								a1. Ins. exp.			-438
									a2. Supplies exp.			-864
									Net income			$40,218

Prepare an income statement for February.

The Fifth Season
Income Statement
For the Month Ended February 28, 20Y4
Fees earned		$fill in the blank 5546d60e803b070_2
Operating expenses:
	$fill in the blank 5546d60e803b070_4
	fill in the blank 5546d60e803b070_6
	fill in the blank 5546d60e803b070_8
	fill in the blank 5546d60e803b070_10
	fill in the blank 5546d60e803b070_12
	fill in the blank 5546d60e803b070_14
Total expenses		fill in the blank 5546d60e803b070_15
		$fill in the blank 5546d60e803b070_17

Feedback

An income statement lists revenues and expenses. When revenues are more than the expenses, the difference is net income.

Prepare a retained earnings statement for February. If an amount box does not require an entry, leave it blank or enter zero "0".

The Fifth Season
Statement of Stockholders Equity
For the Month Ended February 28, 20Y4
	Common Stock	Retained Earnings	Total
Balance, February 1	$fill in the blank 8fe4b2f6c069f9a_1	$fill in the blank 8fe4b2f6c069f9a_2	$fill in the blank 8fe4b2f6c069f9a_3
	fill in the blank 8fe4b2f6c069f9a_5	fill in the blank 8fe4b2f6c069f9a_6	fill in the blank 8fe4b2f6c069f9a_7
	fill in the blank 8fe4b2f6c069f9a_9	fill in the blank 8fe4b2f6c069f9a_10	fill in the blank 8fe4b2f6c069f9a_11
	fill in the blank 8fe4b2f6c069f9a_13	fill in the blank 8fe4b2f6c069f9a_14	fill in the blank 8fe4b2f6c069f9a_15
Balance, February 28	$fill in the blank 8fe4b2f6c069f9a_16	$fill in the blank 8fe4b2f6c069f9a_17	$fill in the blank 8fe4b2f6c069f9a_18

Feedback

Recall that net income on the income statement must be equal to the net effects of revenues and expenses on retained earnings. Therefore, beginning retained earnings plus net income less dividends is equal to ending retained earnings.

Prepare a balance sheet for February.

The Fifth Season
Balance Sheet
February 28, 20Y4
Assets
		$fill in the blank 50d1e9f3603405f_2
		fill in the blank 50d1e9f3603405f_4
		fill in the blank 50d1e9f3603405f_6
Total assets		$fill in the blank 50d1e9f3603405f_7
Liabilities
		$fill in the blank 50d1e9f3603405f_9
Stockholders' Equity
	$fill in the blank 50d1e9f3603405f_11
	fill in the blank 50d1e9f3603405f_13
Total stockholders' equity		fill in the blank 50d1e9f3603405f_14
Total liabilities and stockholders' equity		$fill in the blank 50d1e9f3603405f_15

Feedback

Recall that the balance sheet is a formal representation of the accounting equation, such that total assets must be equal to total liabilities and owner's equity. Assets are items owned by the company, while liabilities are debts owed to creditors, and owner's equity represents the rights of the owner.

Prepare a statement of cash flows for February. If your answer is zero enter "0". Enter net cash outflows as negative amounts.

The Fifth Season
Statement of Cash Flows
For the Month Ended February 28, 20Y4
Cash flows from operating activities:
	$fill in the blank c43487f5ef8e014_2
	fill in the blank c43487f5ef8e014_4
		$fill in the blank c43487f5ef8e014_6
Cash flows from financing activities:
	$fill in the blank c43487f5ef8e014_8
	fill in the blank c43487f5ef8e014_10
		fill in the blank c43487f5ef8e014_12
		$fill in the blank c43487f5ef8e014_14
		fill in the blank c43487f5ef8e014_16
		$fill in the blank c43487f5ef8e014_18