On January 1, Year 1, Jana started a small flower merchandising business that she named Jana's Flowers. The company experienced the following events during the first year of operation: 1. Started the business by issuing common stock for $23,000 cash. 2. Paid $16,000 cash to purchase inventory. 3. Sold merchandise that cost $10,000 for $22,000 on account. 4. Collected $19,000 cash from accounts receivable. 5. Paid $4,800 for operating expenses. Required a. Organize ledger accounts under an accounting equation and record the events in the accounts. In the last column of the table, provide appropriate account titles for the Retained Earnings amounts. b-1. Prepare an income statement. b-2. Prepare a balance sheet. b-3. Prepare a statement of cash flows. c. Since Jana sold inventory for $22,000, she will be able to recover more than half of the $23,000 she invested in the stock. Do you agree with this statement? Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req B3 Reqc Organize ledger accounts under an accounting equation and record the events in the accounts. In the last column of the table, provide appropriate account titles for the Retained Earnings amounts. (If there is no effect on the Account Titles for Retained Earnings, leave the cell blank. Not all cells will require input. Enter any decreases to account balances with a minus sign.) Show less JANA'S FLOWERS Effect of Events on the Accounting Equation Assets = Stockholders' Equity Accounts Titles for Event Accounts Common Cash Retained + Inventory Retained Receivable Stock Earnings Earnings 1. 2. + 3a. 3b. 4. + 5. + + Total + + + + = + + + + + = + + + + = + + + Req A Req B1 Req B2 Req B3 Reg C Prepare an income statement. JANA'S FLOWERS Income Statement For the Year Ended December 31, Year 1 Req A Req B1 Req B2 Req B3 Reqc Prepare a balance sheet. JANA'S FLOWERS Balance Sheet As of December 31, Year 1 Assets Total assets Liabilities Stockholders' Equity Total stockholders' equity Total liabilities and stockholders' equity Req A Req B1 Req B2 Req B3 Reqc Prepare a statement of cash flows. (Cash outflows should be indicated with a minus sign.) JANA'S FLOWERS Statement of Cash Flows For the Year Ending December 31, Year 1 Cash flows from operating activities: Net cash flow from operating activities Cash flows from investing activities: Cash flows from financing activities: Net cash flows from financing activities: Net change in cash Plus: Beginning cash balance Ending cash balance Req A Req B1 Req B2 Req B3 Reqc Since Jana sold inventory for $22,000, she will be able to recover more than half of the $23,000 she invested in the stock. Do you agree with this statement? Do you agree with this statement?
