Question:

P3-1

Oasis Health Care Inc. is owned and operated by Dr. George Hancock, the sole stockholder. Durning January 20Y6, Oasis Health Care entered into the following transactions:

Jan. 1 - Received $15,000 from Rivers Company as rent for the use of a vacant office in Oasis Health Care's building. Rivers paid the rent six months in advance.

Jan. 1 - Paid $4,200 for an insurance premium on a general business policy.

Jan. 6 - Purchased supplies of $1,800 on account.

Jan. 9 - Collected $27,000 for services provided to customers on account.

Jan. 11 - Paid creditors $3,000 on account.

Jan. 18 - Invested an additional $25,000 in the business in exchange for capital stock.

Jan. 20 - Billed patients $62,000 for services provided on account.

Jan. 25 - Received $12,900 for services provided to customers who paid cash.

Jan. 30 - Paid expenses as follows: wages, $24,000; utilities, $6,000; rent on medical equipment, $5,000; interest, $200; and miscellaneous, $2,500.

Jan. 30 - Paid dividends of $15,000 to stockholders (Dr. Hancock).

Analyze and record the January transactions for Oasis Health Care Inc., using the integrated financial statement framework. Record each transaction by date, and sow the balance for each item after each transaction. The January 1, 20Y6, balance for the balance sheet are shown on the attachment.

P3-2

Adjustment data for Oasis Health Care Inc. for January are as follows:

1. Insurance expired, $800.

2. Supplies on hand on January 31, $1,100.

3. Depreciation on building, $2,000.

4. Unearned rent revenue earned but not paid, $1,700.

5. Wages owed employees but not paid, $1,700.

6. Services provided but not billed to patients, $10,000.

Based on the transactions recorded in January for Problem 3-1, record the adjustments for January using the integrated financial statement framework.

P3-3(Hint: Net income, $43,500)

Data for Oasis Health Care for January are provided in Problems 3-1 and 3-2.

Prepare an income statement, retained earnings statement, and a classified balance sheet for January. The note payable is due in ten years.

Assets Cash Bal., Jan. 1 20,000 Accts. + Rec. 34,500 = Pre. Acc. + Ins. + Supp. + Building - Depr. 700 1,000 150,000 11,200 + Land 120,000 Liabilities Accts. Un. Wages Notes = Pay. + Rev. + Pay. + Pay. 7,500 0 0 30,000 + Stockholders' Equity Capital Retained + Stock + Earnings 50,000 227,500