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Required information Skip to question [The following information applies to the questions displayed below.] Leach Inc. experienced the following events for the first two years
Required information
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[The following information applies to the questions displayed below.]
Leach Inc. experienced the following events for the first two years of its operations:
Year 1:
- Issued $10,000 of common stock for cash.
- Provided $110,000 of services on account.
- Provided $33,000 of services and received cash.
- Collected $77,000 cash from accounts receivable.
- Paid $20,000 of salaries expense for the year.
- Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 6 percent of the ending accounts receivable balance will be uncollectible.
Year 2:
- Wrote off an uncollectible account for $720.
- Provided $130,000 of services on account.
- Provided $25,000 of services and collected cash.
- Collected $112,000 cash from accounts receivable.
- Paid $30,000 of salaries expense for the year.
- Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 6 percent of the ending accounts receivable balance will be uncollectible.
- d-1. Organize the transaction data in accounts under an accounting equation.
- d-2. Prepare an income statement for Year 2.
- d-3. Prepare the statement of changes in stockholders' equity for Year 2.
- d-4. Prepare the balance sheet for Year 2.
- d-5. Prepare the statement of cash flows for Year 2.
- d-6. What is the net realizable value of the accounts receivable at December 31, Year 2?
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