Required information [The following information applies to the questions displayed below.] The following transactions relate to Academy Towing Service. Assume the transactions for the purchase of the wrecke and any capital improvements occur on January 1 of each year Year 1 1. Acquired $78,000 cash from the issue of common stock 2. Purchased a used wrecker for $40,000 cash. It has an estimated useful life of three years and a $4,000 salvage value 3. Paid sales tax on the wrecker of $3.000. 4. Collected $64,100 in towing fees. 5. Paid $12.800 for gasoline and oll. 6. Recorded straight-line depreciation on the wrecker for Year 1. 7. Closed the revenue and expense accounts to Retained Earnings at the end of Year 1. Year 2 1. Paid for a tune-up for the wrecker's engine, $1,700 2. Bought four new tires, $2,050. 3. Collected $70,000 in towing fees. 4. Paid $18,800 for gasoline and oll. 5. Recorded straight-line depreciation for Year 2 6. Closed the revenue and expense accounts to Retained Earnings at the end of Year 2 . Year 3 1. Paid to overhaul the wrecker's engine, $5,600, which extended the life of the wrecker to a total of four years. The salvage value did not change. 2. Paid for gasoline and of, $19,900. 3. Collected $73.000 in towing fees. 4. Recorded straight-the depreciation for Year 3. 5. Closed the revenue and expense accounts at the end of Year 3. c. Use a vertical statements model to present financial statements for Year 1, Yeat 2, and Year 3. (Round your onswers to the nearest dollar amount. Enter items to be deducted and cash outllows with a minus sign.) Statements of Changes in Stockholders' Equity Statements of Cash Flows For the Year Ended December 31 Cash flow from operating activities: Net cash flow from operating activities Cash flows from investing activities. Net cash flow from investing activities Cash flows from financing activities. Net cash flow from financing activities Ending cash balahce Required information [The following information applies to the questions displayed below.] The following transactions relate to Academy Towing Service. Assume the transactions for the purchase of the wrecke and any capital improvements occur on January 1 of each year Year 1 1. Acquired $78,000 cash from the issue of common stock 2. Purchased a used wrecker for $40,000 cash. It has an estimated useful life of three years and a $4,000 salvage value 3. Paid sales tax on the wrecker of $3.000. 4. Collected $64,100 in towing fees. 5. Paid $12.800 for gasoline and oll. 6. Recorded straight-line depreciation on the wrecker for Year 1. 7. Closed the revenue and expense accounts to Retained Earnings at the end of Year 1. Year 2 1. Paid for a tune-up for the wrecker's engine, $1,700 2. Bought four new tires, $2,050. 3. Collected $70,000 in towing fees. 4. Paid $18,800 for gasoline and oll. 5. Recorded straight-line depreciation for Year 2 6. Closed the revenue and expense accounts to Retained Earnings at the end of Year 2 . Year 3 1. Paid to overhaul the wrecker's engine, $5,600, which extended the life of the wrecker to a total of four years. The salvage value did not change. 2. Paid for gasoline and of, $19,900. 3. Collected $73.000 in towing fees. 4. Recorded straight-the depreciation for Year 3. 5. Closed the revenue and expense accounts at the end of Year 3. c. Use a vertical statements model to present financial statements for Year 1, Yeat 2, and Year 3. (Round your onswers to the nearest dollar amount. Enter items to be deducted and cash outllows with a minus sign.) Statements of Changes in Stockholders' Equity Statements of Cash Flows For the Year Ended December 31 Cash flow from operating activities: Net cash flow from operating activities Cash flows from investing activities. Net cash flow from investing activities Cash flows from financing activities. Net cash flow from financing activities Ending cash balahce
