Obj. 1, 2, P2-2 Transactions and financial statements James Nesbitt established Up-Date Computer Services on August 1, 20Y4. The effect of each transaction and the balances after each transaction for August are shown below in the integrated financial statement framework Instructions 1. Prepare an income statement for the month ended August 31, 20Y4. 2. Prepare a statement of stockholders' equity for the month ended August 31, 2014. 3. Prepare a balance sheet as of August 31, 2014. 4. Prepare a statement of cash flows for the month ended August 31, 2014. 4. Net cash flows from financing activities, $32,000 Financial Statement Effects Assets BALANCE SHEET = Liabilities + Stockholders' Equity Notes Common Retained Payable + Stock + Earnings Cash + Land = 25,000 27,000 25,000 27,000 52,000 (2,500) 49,500 25,000 27,000 (2,500) 24,500 25,000 10,000 10,000 25,000 24,500 a. Issued common stock b. Fees earned Balances c. Rent expense Balances d. Issued notes payable Balances e. Purchased land Balances 4. Paid expenses Balances g. Paid salary expense Balances i. Paid dividends Balances, Aug. 31 10,000 59,500 (40,000) 19,500 (1,900) 17,600 40,000 40,000 10,000 25,000 24,500 (1,900) 22,600 40,000 10,000 25,000 40,000 10,000 25,000 (4,600) 13,000 (3,000) 10,000 (4,600) 18,000 (3,000) 15,000 40,000 10,000 25,000 STATEMENT OF CASH FLOWS a. Financing 25,000 b. Operating 27,000 c. Operating (2,500) d. Financing 10,000 e. Investing (40,000) f. Operating (1,900) g. Operating (4,600) h. Financing (3,000) Increase in cash 10,000 INCOME STATEMENT b. Fees earned 27,000 c. Rent expense (2,500) f. Auto expense (1,200) f. Misc. expense (700) g. Salary expense (4,600) Net income 18,000