Madison Company is a land management company that generates most of its revenues through leasing land. The

company experienced the following events during Year $2$:

Madison Company issued $$800,000$ of $10-$year, $6$ percent bonds on January $1,$ Year $2.$ The bonds were issued at face

value. Interest is payable in cash on December $31$ of each year.

Madison Company immediately invested all the proceeds from the bond issue in land.

The land was immediately leased for an annual $$110,000$ of cash revenue. The first year's rent was collected on

December $31,$ Year $2.$

Madison Company paid the interest on the bond on December $31,$ Year $2.$

Required:

Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and

statement of cash flows. More specifically, record the amounts of the events into the model.

Note: In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing

activity, and NC for net change in cash. Enter any decreases to account balances and cash outflows with a minus

sign. Not all cells require input $-$ leave cells blank if there is no corresponding input needed.