odule 2 Textbook Problems i Saved Help Save & Exit Submit Check my work 1 Problem: Module 2 Textbook Problem 1 Learning Objective: 2-2 Use the percent of revenue method to account for uncollectible accounts expense Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for its first year of operations: Events Affecting Year 1: 5 Dints Hint Print 1. Provided $150,000 of cleaning services on account. 2. Collected $112,500 cash from accounts receivable. 3. Paid salaries of $24,000 for the year. 4. Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $1,300. The expense was determined using the percent of revenue method. Required a. Organize the transaction data in accounts under an accounting equation. b. Prepare an income statement, a balance sheet, and a statement of cash flows for Year 1. Complete this question by entering your answers in the tabs below. Reg A Req B1 Reg B2 Req B3 Organize the transaction data in accounts under an accounting equation. (Enter any decreases to account balances with a minus sign. If there is no effect on the Accounts Titles for Retained Earnings, leave the cell blank. Not all cells will require entry) Complete this question by entering your answers in the tabs below. Chec Req A Req B1 Req B2 Req B3 ts Organize the transaction data in accounts under an accounting equation. (Enter any decreases to account balances with a minus sign. If there is no effect on the Accounts Titles for Retained Earnings, leave the cell blank. Not all cells will require entry.) Hint Print HOLMES CLEANING SERVICE Horizontal Statements Model Balance Sheet Assets Equity Accounts Titles for Retained NRV Earnings Retained + Accounts Receivable Eartngs Event Cash Year 1 1. 150,000 Service revenue 150,000/= (112,500) ) 2. 112,500+ (24,000) + 3. + (1,300) = 36,200 = (24,000) Salaries expense (1,300) (Uncollectible accounts expense 124,700 Bal 88.500 + Reg Req B1 > Chec 1 Complete this question by entering your answers in the tabs below. Req A Req B1 Reg B2 Reg B3 0.5 points Prepare an income statement for Year 1. Hint Print HOLMES CLEANING SERVICE Income Statement For the Year Ended December 31, Year 1 Service revenue Operating expenses Salaries expense $ 24,000 Uncollectible accounts expense 1,300 $ 150,000 Total operating expenses Net income 25,300 $ 124,700 1 1 Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req B3 0.5 points Prepare a balance sheet for Year 1. Hint HOLMES CLEANING SERVICE Balance Sheet As of December 31, Year 1 Print Assets Cash $ 88,500 1,300 Accounts receivable Less: Allowance for doubtful accounts Total assets Liabilities Stockholders' Equity Retained earnings (1,300) $ 87,200 $ 124,700 0 Total stockholders' equity Total liabilities and stockholders' equity 124,700 $ 124,700