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 $110,000 of services on account. 3. Provided $29,000 of services and received cash. 4. Collected $81,000 cash from accounts receivable. 5. Paid $16,000 of salaries expense for the year. 6. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Year 2: 1. Wrote off an uncollectible account for $650. 2. Provided $130,000 of services on account 3. Provided $25,000 of services and collected cash. 4. Collected $112,000 cash from accounts receivable. 5. Paid $30,000 of salaries expense for the year. 6. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Required a. Organize the transaction data in accounts under an accounting equation. b. Prepare the income statement, statement of changes in stockholders' equity, balance sheet, and statement of cash flows for Year 1. c. What is the net realizable value of the accounts receivable at December 31, Year 1? 2 Complete this question by entering your answers in the tabs below. Reg Bal Reg B Inc Stmt REGA Red B Stmt of Changes Reg C Reg B Simt Cash Flows Sheet Organize the transaction data in accounts under an accounting equation. (Enter any decreases to account balances with a minus sign. If there is no effect on the Accounts Titles for Retained Earnings, leave the cell blank. Not all cells will require entry) LEACHING Accounting Equation for the Year 1 Equity Liabilities Common Retained Stock Earnings Assets NRV Accounts Receivable Accounting Tities for Retained Earnings Event Cash 1 2 3 4 5 6. 0 0 Bal RA Reg Inc Simt> c. What is the net realizable value of the accounts receivable at December 31, Year 1? Complete this question by entering your answers in the tabs below. Req B Inc Red B Stmt of Stmt Changes Req B Bal Sheet Req B Stmt Cash Flows Reg A Reg C Prepare the income statement for Year 1. LEACH INC. Income Statement For the Year Ended December 31, Year 1 Operating expenses 0 Total operating expenses c. What is the net realizable value of the accounts receivable at December 31, Year 1? Complete this question by entering your answers in the tabs below. Reg Req B Inc Red Stmt of Req B Bal Reg A Reg B Stmt Stmt Changes Sheet Cash Flows 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 Ending common stock $ 0 Beginning retained earnings Ending retained earnings Total stockholders' equity 0 0 $ c. What is the net realizable value of the accounts receivable at December 31, Year 1? Complete this question by entering your answers in the tabs below. Reg A Reg B Inc Reg B Stmt of Req B Bal Stmt Changes Req B Stmt Cash Flows Reg C Sheet Prepare the balance sheet for Year 1. LEACH INC. Balance Sheet As of December 31, Year 1 Assets 0 $ 0 Total assets Liabilities Stockholders' equity 0 Total stockholders' equity Total liabilities and stockholders' equity 0 Complete this question by entering your answers in the tabs below. Reg A Req B Inc Reg B Stmt of Stmt Changes Reg B Bal Sheet Req B Stmt Cash Flows ReqC Prepare the statement of cash flows for Year 1. (Cash outflows 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 $ 0 Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Net cash flow from financing activities $ 0 Net change in cash 0 0 Ending cash balance $ 0 What is the net realizable value of the accounts receivable at December 31, Year 1? Net realizable value
