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Gifford Company experienced the following accounting events during Year 1: 1. Started operations on January 1 when it acquired $38,000 cash by issuing common stock. 2. Earned $39,600 of revenue on account. 3. On March 1 collected $57,600 cash as an advance for services to be performed in the future. 4. Paid cash operating expenses of $35,000. 5. Paid a $4,500 cash dividend to stockholders. 6. On December 31, Year 1, adjusted the books to recognize the revenue earned by providing services related to the advance described in Event 3. The contract required Gifford to provide services for a one-year period starting March 1. 7. Collected $33,000 cash from accounts receivable. Gifford Company experienced the following accounting events during Year 2: 1. Recognized $59,600 of cash revenue. 2. On April 1, paid $14,160 cash for an insurance policy that provides coverage for one year beginning immediately. 3. Collected $3,800 cash from accounts receivable. 4. Paid cash operating expenses of $39,000. 5. Paid a $6,800 cash dividend to stockholders. 6. On December 31, Year 2, adjusted the books to recognize the remaining revenue earned by providing services related to the advance described in Event 3 of Year 1. 7. On December 31, Year 2, Gifford adjusted the books to recognize the amount of the insurance policy used during Year 2. Required a. Record the events in a financial statements model. The first event is recorded as an example. b. What am of would Gifford report on the Year 1 incom statement? c. What amount of cash flow from customers would Gifford report on the Year 1 statement of cash flows? d. What amount of unearned revenue would Gifford report on the Year 1 and Year 2 year-end balance sheets? e. What are the Year 2 opening balances for the revenue and expense accounts? f. What amount of total assets would Gifford report on the December 31, Year 1, balance sheet? Complete this question by entering your answers in the tabs below. Req A Year 1 Req A Year 2 Record the events in a financial statements model for Year 1. The first event is recorded as an example. (In the Cash Flow column, use the initials OA to designate operating activity, IA for investing activity, FA for financing activity, for Net change in cash. Enter any decreases to account balances with a minus sign. Not all cells require input. If there is no effect on the Account Titles for Statement of Cash Flows, leave the cell blank.) Event No. Year 1 1. 2. 3. 4. 5. 6. 7. Bal. Cash + 38,000 + + + + + + Req B to F + 38,000 + Assets Accounts Receivable + + + + + + + + 0 + Balance Sheet Prepaid Insurance = = = = = = 0 = GIFFORD COMPANY Horizontal Financial Statements For Year 1 Liabilities + Unearned Revenue + + + + + + + Stockholders' Equity Common Stock + 38,000 + + + + Retained Earnings 0 Revenue = = = = = = = = = Net Income 0 Statement of Cash Flows 38,000 FA 38,000 Show Complete this question by entering your answers in the tabs below. Req A Year 1 Req A Year 2 Req B to F Record the events in a financial statements model for Year 2. (In the Cash Flow column, use the initials OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for Net change in cash. Enter ar decreases to account balances with a minus sign. Not all cells require input. If there is no effect on the Account Titles for Statement of Cash Flows, leave the cell blank.) Event No. Bal. 1. 2. 3. 4. 5. 6. 7. Bal. Cash + + + ++++ + + + Assets Accounts Receivable + + + + + + + + + 0 + Balance Sheet Prepaid Insurance 0 = GIFFORD COMPANY Horizontal Financial Statements For Year 2 Liabilities + Unearned Revenue + + + 0 + Stockholders' Equity Retained Earnings Common Stock 0 + + + + + 0 Revenue = = = = = = = = = Net Income 0 Statement of Cash Flows 0 S Req A Year 1 Req A Year 2 Complete this question by entering your answers in the tabs below. b. b. What amount of revenue would Gifford report on the Year 1 income statement? c. What amount of cash flow from customers would Gifford report on the Year 1 statement of cash flows? d. What amount of unearned revenue would Gifford report on the Year 1 and Year 2 year-end balance sheets? e. What are the Year 2 opening balances for the revenue and expense accounts? f. What amount of total assets would Gifford report on the December 31, Year 1, balance sheet? Revenue C. d. Unearned revenue for Year 1 Unearned revenue for Year 2 f. Req B to F e. Revenue account, opening balance Expense account, opening balance Total assets Show less
