The following events occurred at Jack Company ding its first year of business Required To establish the company, the two owners contrbuted a total of $60,000 in exchange Grooming service revenue for the first year amounted to $175,000, of which $50,000 Customers owe $15,000 at the end of the year from the services provided on account At the beginning of the year, a storage building was rented. The company was required to sign a three-year lease for $15,000 per year and make a $3,000 refundable security deposit. The first year's lease payment and the security deposit were paid at the beginning of the year At the beginning of the year, the company purchased a patent at a cost of $120,000 for a revolutionary system to be used for dog grooming. The patent is expected to be useful for ten years The company paid 20% down in cash and signed a four-year note at the bank for the remainder. Operating expenses, including amortization of the patent and rent on the storage building noted in (d) and (e) above, totaled $90,000 for the first year No espenses were accrued or unpaid at the end of the year The company declared and paid a $25,000 cash dividend at the end of the first year 1 2 Prepare an income statement for the first year Prepare a balance sheet as of the end of the first Prepare a statement of cash flows for the first year using the direct method in the Operating Activities section 3 Did th e company generate more or less cash flow 4 from operations than it eamed in net income? Explain why there is a difference. 10 12 6