Problem 3-22A (Algo) Effect of purchase returns and allowances and purchase discounts on the financial statements: Perpetual system LO 3-2, 3-3 The following events were completed by Dana's Imports in September, Year 1: Bept. Aequired $46.000 cash from the issue of common stock. 1 Purchased $31,000 of merchandise on account with terms 2/10, 1/30. 5 Paid $1,000 cash for freight to obtain merchandise purchased on September 1. 8 Sold merchandise that cost $10,500 to customers for $17,500 on account, with terms 2/10, n/30. B Returned $650 of defective merchandise from the September 1 purchase to the supplier. 10 Paid cash for the balance due on the merchandise purchased on September 1. 20 Received cash from customers of September 8 sale in settlement of the account balances, but not within the discount period. 30 Paid $3,050 cash for selling expenses. Required a. Record each event in a statements model like the following one. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cell blank. The first eventlis recorded as an example. b. Prepare an income statement for the month ending September 30, c. Prepare a statement of cash flows for the month ending September 30, Complete this question by entering vour answers in the tabs below. Required A Required B Required Record each event in a statements model like the following one. In the Cash Flow column, use OA to designate operating activity, IA change in cash. If the element is not affected by the event, leave the cell blank. The first event is recorded as an example. (Not eve and cash outflows with a minus sign.) Date DANA'S IMPORTS Effect of Transactions on Financial Statements Using Horizontal Statements Model Balance Sheet Income Statement Assets Liabilities - Stockholders' Equity Net Accounts Accounts Common Retained Revenue - Expenses Income Receivable Inventory Payable Stock Earnings 46,000 + State Fle Cash 45.000 9/1 46,000+ tr 9/1 9/5 9/Ba + 9/8). 9/8c 9/10 9/20 9/30 Prey 1 of 5 Next > DANA'S IMPORTS act of Transactions on Financial Statements Using Horizontal Statements Model Balance Sheet Income Statement Liabilities + Stockholders' Equity Net Accounts Common Retained Revenue Expenses Income Inventory Payable Stock Earnings 46,000 + Statement of Cash Flows = + 46,000 FA + + + IIIIIII + + + + + + ### 11 Nex Next > Income Statement Assets Accounts Receivable Balance Sheet Liabilities Accounts Inventory Payable Statement of Cash Flow Revenue Expenses Cash Stockholders' Equity Common Retained Stock Earnings 46,000 Net Income 46,000+ 46,000 FA . $ $ 0 ol. 0 $45.000 $ $ $ 0+ $ $ 46,000+ $ 46,000+ Reyuired B Required A Required B Required Prepare an income statement for the month ending September 30, DANA'S IMPORTS Income Statement For the Month Ended September 30, Year 1 Operating expenses Check my work Prepare a statement of cash flows for the month ending September 30. (Cash outflows should be indicated with a minus sign.) DANA'S IMPORTS Statement of Cash Flows For the Month ended September 30, Year 1 Cash flows from operating activities $ 0 Net cash flow from operating activities Cash flows from investing activities: Cash flows from financing activities: Net cash flow from financing activities Net change in cash 0 0 $ 0 Ending cash balance
