Life, Incorporated experienced the following events in Year 1, its first year of operation: 1. Performed counseling services for $34,000 cash. 2. On February 1, Year 1, paid $24,000 cash to rent office space for the coming year. 3. Adjusted the accounts to reflect the amount of rent used during the year. Required: Based on this information alone: a. Record the events in accounts under an accounting equation. Note: Enter any decreases to account balances with a minus sign. Event LIFE, INCORPORATED Effect of Events on the Accounting Equation 1. Performed services 2. Prepaid rent 3. Used rent Totals Cash Assets LIFE, INCORPORATED Prepaid Rent ||| ||||| Stockholders' Equity Retained Earnings b. Prepare an income statement, balance sheet, and statement of cash flows for the Year 1 accounting period. Note: In statement of cash flows, cash outflows should be indicated with a minus sign.

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Life, Incorporated experienced the following events in Year 1, its first year of operation: 1. Performed counseling services for $34,000cash. 2. On February 1, Year 1, paid $24,000 cash to rent office space for the coming year. 3. Adjusted the accounts to reflect the amount of rent used during the year. Required: Based on this information alone: a. Record the events in accounts under an accounting equation. Note: Enter any decreases to account balances with a minus sign. b. Prepare an income statement, balance sheet, and statement of cash flows for the Year 1 accounting period. Note: In statement of cash flows, cash outflows should be indicated with a minus sign. 2 a