Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I got the first part. I want to make sure that b is correct. and need the rest answered also thanks Davidson Company was started

I got the first part. I want to make sure that b is correct. and need the rest answered also thanks

image text in transcribedimage text in transcribedimage text in transcribed

Davidson Company was started on January 1, 2014, and experienced the following events during its first year of operation: 1. Acquired $52,000 cash from the issue of common stock 2. Borrowed $20,000 cash from National Bank 3. Earned cash revenues of $42,000 for performing services. 4. Paid cash expenses of $23,000. 5. Paid a $6,000 cash dividend to the stockholders. 6. Acquired an additional $10,000 cash from the issue of common stock 7. Paid $10,000 cash to reduce the principal balance of the bank note 8. Paid $45,000 cash to purchase land. 9. Determined that the market value of the land is $55,000. Required a. Record the preceding transactions in the horizontal statements model. Also, in the Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA) net change in cash (NC) and NA to indicate the element is not affected by the event. The first event is shown as an example. (Enter any decreases to account balances and cash outflows with a minus sign.) DAVIDSON COMPANY Horizontal Statements Model for 2014 Balance Sheet Income Statement Event Statement of Cash Flow Assets = Liabilities + Stockholders' Equity Common Retained Revenue-Expense Notes Cash + Land 52,000 20,000 42,000 Payablec Earnings 52,000 52,000 FA 20,000 42,000 20,000+ + 4200of 42,000 (23.000 4. (23,000) + (23,000) (23,000) (23,000) (6,000)|+ (6.000 (6,000) 5 0,000 0,000 FA (10,000) 45,000) IA 10,000+ (10,000) 7.(10,000) 8. (45,000)| 45,000|= Total | 40,000 | + | 45,000-10,000 | +| 62,000 | + | 13,000 42.000 (23,000) 0 40,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions