Required information [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: 1. Issued $10,000 of common stock for cash. 2. Provided $78,000 of services on account. 3. Provided $36,000 of services and received cash. 4. Collected $69,000 cash from accounts receivable. 5. Paid $38,000 of salaries expense for the year. 6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible. Year 2: 1. Wrote off an uncollectible account for $650. 2. Provided $88,000 of services on account. 3. Provided $32,000 of services and collected cash. 4. Collected $81,000 cash from accounts receivable. 5. Paid $65,000 of salaries expense for the year. 6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible. b. Prepare an income statement, statement of changes in stockholders' equity, balance sheet, and statement of cash flows for Year 1. Prepare an income statement for Year 1. LEACH INC. Income Statement For the Year Ended December 31, Year 1 Service revenue $ 120,000 Operating expenses Salaries expense Salaries expense $ (38,000) (38,000) (450) Uncollectible accounts expense Total operating expenses (76,450) Prepare the statement of changes in stockholders' equity for Year 1. LEACH INC. Statement of Changes in Stockholders' Equity For the Year Ended December 31, Year 1 Beginning common stock $ 10,000 Ending common stock $ 10,000 Beginning retained earnings Ending retained earnings Total stockholders' equity 10,000 Prepare the balance sheet for Year 1. LEACH INC. Balance Sheet As of December 31, Year 1 Assets Cash $ 77,000 Accounts receivable $ 8,550 8,550 85,550 Total assets $ Liabilities Stockholders' equity Common stock Retained earnings $ 10,000 75,550 Total stockholders' equity Total liabilities and stockholders' equity 85,550 85,550 $ Dear stmt SE DAAR Stmt cash flow Prepare the statement of cash flows for Year 1. (Amounts to be deducted should be indicated with a minus sign.) LEACH INC. Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities Infow from stock issued ($ 36,000 Inflow from customers 69,000 $ 105,000 (38,000) Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Inflow for issue of common stock Net change in cash 67,000 Ending cash balance $ 67,000