Required information

$[$The following information applies to the questions displayed below.$]$

Alcorn Service Company was formed on January $1,$ Year $1.$

Events Affecting the Year $1$ Accounting Period

Acquired $$80,000$ cash from the issue of common stock.

Purchased $$5,200$ of supplies on account.

Purchased land that cost $$58,000$ cash.

Paid $$5,200$ cash to settle accounts payable created in Event $2.$

Recognized revenue on account of $$82,000.$

Paid $$41,000$ cash for other operating expenses.

Collected $$58,000$ cash from accounts receivable.

Information for Year $1$ Adjusting Entries

Recognized accrued salaries of $$5,200$ on December $31,$ Year $1.$

Had $$2,200$ of supplies on hand at the end of the accounting period.

Events Affecting the Year $2$ Accounting Period

Acquired $$40,000$ cash from the issue of common stock.

Paid $$5,200$ cash to settle the salaries payable obligation.

Paid $$9,600$ cash in advance to lease office space.

Sold the land that cost $$58,000$ for $$58,000$ cash.

Received $$10,800$ cash in advance for services to be performed in the future.

Purchased $$3,000$ of supplies on account during the year.

Provided services on account of $$52,000.$

Collected $$53,000$ cash from accounts receivable.

Paid a cash dividend of $$6,000$ to the stockholders.

Paid other operating expenses of $$39,500.$

Information for Year $2$ Adjusting Entries

The advance payment for rental of the office space $($see Event $3)$ was made on March $1$ for a one$-$year term.

The cash advance for services to be provided in the future was collected on October $1($see Event $5).$ The one$-$year

contract started on October $1.$

Had $$2,300$ of supplies remaining on hand at the end of the period.

Recognized accrued salaries of $$5,900$ at the end of the accounting period.

Recognized $$2,400$ of accrued interest revenue.

b$-1.$ Prepare an income statement for Year $1$ and Year $2.$

b$-2.$ Prepare the statement of changes in stockholders' equity for Year $1$ and Year $2.$

b$-3.$ Prepare the balance sheet for Year $1$ and Year $2.$

b$-4.$ Prepare the statement of cash flows for Year $1$ and Year $2,$ using the vertical statements model.

Complete this question by entering your answers in the tabs below.

Prepare the balance sheet for Year $1$ and Year $2.$

ALCORN SERVICE COMPANY

Balance Sheets