Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required information [ The following information applies to the questions displayed below. ] Alcorn Service Company was formed on January 1 , Year 1 .

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.
Req BI
Req B2
Req B3
Req B4
Prepare an income statement for Year 1 and Year 2.(Do not round intermediate calculations.)
ALCORN SERVICE COMPANY
Income Statements
For the Years Ended December 31, Year 1 and Year 2)
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Nmap Network Exploration And Security Auditing Cookbook

Authors: Paulino Calderon

2nd Revised Edition

1786467453, 978-1786467454

More Books

Students also viewed these Accounting questions