Saved Required Explain how each of the following events or series of events and the related adjusting entry will affect the amount of net income and the amount of cash flow from operating activities reported on the year-end financial statements. Identify the direction of change (increase or decrease) and the amount of the change. If there is no change, leave the cell blank. Organize your answers according to the following table. The first event is recorded as an example. If an event does not have a related adjusting entry, record only the effects of the event. (Not all cells require entry. Do not round intermediate calculations.) a. Paid $2,600 cash on October 1 to purchase a one-year insurance policy b. Purchased $1,400 of supplies on account. Paid $750 cash on accounts payable. The ending balance in the Supplies account after adjustment, was $300. c. Provided services for $7,500 cash. d. Collected $10.200 in advance for services to be performed in the future. The contract called for services to start on May 1 and to continue for one year. e. Accrued salaries amounting to $4,200. f. Sold land that cost $17,500 for $17.500 cash. g. Acquired $47.000 cash from the issue of common stock. h. Earned $11,500 of revenue on account. Collected $10,350 cash from accounts receivable. i. Pald cash for other operating expenses of $1.600. Cash Flows from Net Income Eventi Operating Activities Adjustment Direction of Amount of Direction of Amount of Change Change Change Change a Decrease $ 2,600 Adj Decrease 650 b o Decrease 1.100 Adi 750 0 0 Increase 71500 Adj Increase 7.500 d. 0 Increase 10,200 Increase 6,800 Adi Prey 27 of 29 Next > i. Paid cash for other operating expenses of $1,600. Cash Flows from Net Income Eventi Operating Activities Adjustment Direction of Amount of Direction of Amount of Change Change Change Change a Decrease $ 2,600 Adj. Decrease 650 b. 0 Decrease 1,100 Adj. 750 0 c. o increase 7,500 Adj. Increase 7,500 0 d. 0 Increase 10,200 Adj. Increase 6,800 e. Decrease 4,200 Adj. 0 f. Decrease 17,500 Increase 17,500 Adj 0 0 g Increase 47,000 Adj. 0 0 h. Increase 11,500 0 Adj. o increase 10,350 1 Decrease 1,600 Decrease 1,600 Adj. 0 0 a. Adj 650 b. Adj c. Ad) d. Adj e. Adj. f. Adj. 6800 Explanations for Adjustments Cash paid 2600 insurance is for one year, and current year expense is 3 months and balance is prepaid Oct., Nov. and Dec. Insurance expense = Total payment*3/12 =2600/12*3 Cash paid 750 Supplies purchased is 1400 and closing balance is 300 that means supplies expense is 1400-300=1100 Cash received Revenue earned is income so increase in net income Cash collected 10200 10200 for a period of one year starting May 1, 8 months so current year income is = 10200/12*8 No cash payment Accrued salary means current yaer expense payable, so increase in salary expense, decrease income receipt of cash 17500 will not affect income as there is no profit or loss in sale of land receipt of cash 47000 Not affect income Cash collected only 10350 Revenue earned is 11500, so income and income increased 11500 payment of cash 1600 Opertaing expense will decrease net income 1600 Adi. h. Adj. 1. Ad. Saved Required Explain how each of the following events or series of events and the related adjusting entry will affect the amount of net income and the amount of cash flow from operating activities reported on the year-end financial statements. Identify the direction of change (increase or decrease) and the amount of the change. If there is no change, leave the cell blank. Organize your answers according to the following table. The first event is recorded as an example. If an event does not have a related adjusting entry, record only the effects of the event. (Not all cells require entry. Do not round intermediate calculations.) a. Paid $2,600 cash on October 1 to purchase a one-year insurance policy b. Purchased $1,400 of supplies on account. Paid $750 cash on accounts payable. The ending balance in the Supplies account after adjustment, was $300. c. Provided services for $7,500 cash. d. Collected $10.200 in advance for services to be performed in the future. The contract called for services to start on May 1 and to continue for one year. e. Accrued salaries amounting to $4,200. f. Sold land that cost $17,500 for $17.500 cash. g. Acquired $47.000 cash from the issue of common stock. h. Earned $11,500 of revenue on account. Collected $10,350 cash from accounts receivable. i. Pald cash for other operating expenses of $1.600. Cash Flows from Net Income Eventi Operating Activities Adjustment Direction of Amount of Direction of Amount of Change Change Change Change a Decrease $ 2,600 Adj Decrease 650 b o Decrease 1.100 Adi 750 0 0 Increase 71500 Adj Increase 7.500 d. 0 Increase 10,200 Increase 6,800 Adi Prey 27 of 29 Next > i. Paid cash for other operating expenses of $1,600. Cash Flows from Net Income Eventi Operating Activities Adjustment Direction of Amount of Direction of Amount of Change Change Change Change a Decrease $ 2,600 Adj. Decrease 650 b. 0 Decrease 1,100 Adj. 750 0 c. o increase 7,500 Adj. Increase 7,500 0 d. 0 Increase 10,200 Adj. Increase 6,800 e. Decrease 4,200 Adj. 0 f. Decrease 17,500 Increase 17,500 Adj 0 0 g Increase 47,000 Adj. 0 0 h. Increase 11,500 0 Adj. o increase 10,350 1 Decrease 1,600 Decrease 1,600 Adj. 0 0 a. Adj 650 b. Adj c. Ad) d. Adj e. Adj. f. Adj. 6800 Explanations for Adjustments Cash paid 2600 insurance is for one year, and current year expense is 3 months and balance is prepaid Oct., Nov. and Dec. Insurance expense = Total payment*3/12 =2600/12*3 Cash paid 750 Supplies purchased is 1400 and closing balance is 300 that means supplies expense is 1400-300=1100 Cash received Revenue earned is income so increase in net income Cash collected 10200 10200 for a period of one year starting May 1, 8 months so current year income is = 10200/12*8 No cash payment Accrued salary means current yaer expense payable, so increase in salary expense, decrease income receipt of cash 17500 will not affect income as there is no profit or loss in sale of land receipt of cash 47000 Not affect income Cash collected only 10350 Revenue earned is 11500, so income and income increased 11500 payment of cash 1600 Opertaing expense will decrease net income 1600 Adi. h. Adj. 1. Ad