[The following information applies to the questions displayed below.]

The following transactions apply to Baker Co. for 2010, its first year of operations.

1.	Issued $140,000 of common stock for cash.
2.	Provided $90,000 of services on account.
3.	Collected $74,000 cash from accounts receivable.
4.	Loaned $15,000 to BBC on September 1, 2010. The note had a one-year term to maturity and an 10 percent interest rate.
5.	Paid $34,000 of salaries expense for the year.
6.	Paid a $3,500 dividend to the stockholders.
7.	Recorded the accrued interest on December 31, 2010 (see item 4).
8.	Uncollectible accounts expense is estimated to be 1 percent of sales on account.

rev: 03-01-2011

1.

value: 2.00 points

Required information

Requirement 1:

Show the effects of the above transactions in a horizontal statements model like the one shown below. When you record amounts in the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), financing activity (FA), or Net Cash (NC). The letters NA indicate that an element is not affected by the event. (Round your final answers to the nearest dollar amount. Negative amounts should be indicated with a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Baker Co. Horizontal Statement Model

Balance Sheet

Income Statement

Statement of Cash Flows

Event

Assets

=

Equity

Rev.

Exp.

=

Net Inc.

Cash

Accts. Rec.

Allow

Notes Rec.

Int. Rec.

=

Com. Stock

Ret. Earn.

1.

(Click to select)IAOANCNAFA

2.

(Click to select)NAOAIAFANC

3.

(Click to select)NCFAIAOANA

4.

(Click to select)OANCFAIANA

5.

(Click to select)FAOAIANANC

6.

(Click to select)OANCIANAFA

7.1

(Click to select)OANAIAFANC

8.2

(Click to select)FAOANCNAIA

Tot.

=

=

(Click to select)NAFANCOAIA

References

eBook & Resources

WorksheetLearning Objective: 05-2

Difficulty: HardLearning Objective: 05-4

Check my work

2.

value: 3.00 points

Required information

Requirement 2:

Prepare the income statement, balance sheet, and statement of cash flows for 2010. (Round your final answers to the nearest dollar amount. Amounts in parentheses do not require a minus sign in front of them. Be sure to list the expenses on the income statement in order of their magnitude. Be sure to list the assets and liabilities in order of their liquidity. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Baker Co. Financial Statements For the Year Ended 2010
Income Statement
(Click to select)Interest RevenueUncoll. Accounts ExpenseNet Operating IncomeSalaries ExpenseService Revenue		$
Operating Expenses
(Click to select)Net Operating IncomeSalaries ExpenseInterest RevenueUncoll. Accounts ExpenseService Revenue	$
(Click to select)Service RevenueUncoll. Accounts ExpenseInterest RevenueSalaries ExpenseNet Operating Income
Total Operating Expenses		()
(Click to select)Uncoll. Accounts ExpenseService RevenueInterest RevenueSalaries ExpenseNet Operating Income
Non-Operating Items
(Click to select)Uncoll. Accounts ExpenseInterest RevenueNet Operating IncomeSalaries ExpenseService Revenue
(Click to select)Net LossNet Income

Baker Co. Financial Statements For the Year Ended 2010
Statement of Changes in Stockholders' Equity
(Click to select)DividendsBeginning Common StockEnding Common StockStock IssuedNet Income	$
(Click to select)LessPlus: (Click to select)Beginning Common StockDividendsStock IssuedEnding Common StockNet Income
(Click to select)Net IncomeEnding Common StockDividendsBeginning Common StockStock Issued		$
(Click to select)Beginning Retained EarningsStock IssuedEnding Retained EarningsNet IncomeDividends
(Click to select)LessPlus: (Click to select)Ending Common StockDividendsBeginning Common StockStock IssuedNet Income
(Click to select)LessPlus: (Click to select)Stock IssuedEnding Common StockNet IncomeBeginning Common StockDividends	()
(Click to select)Ending Retained EarningsBeginning Retained EarningsNet IncomeStock IssuedDividends
Total Stockholders' Equity		$

Baker Co. Balance Sheet As of the End of the Year 2010
Assets			Liabilities		$
(Click to select)Accounts ReceivableCommon StockCashInterest ReceivableNotes Receivable		$
(Click to select)CashAccounts ReceivableInterest ReceivableNotes ReceivableCommon Stock			Stockholders' Equity
(Click to select)Common StockAllowance for Doubtful AccountsAccounts payableDividendsRetained Earnings	()		(Click to select)Common StockRetained EarningsNotes ReceivableAccounts ReceivableInterest Receivable	$
(Click to select)Interest ReceivableCommon StockAccounts ReceivableCashNotes Receivable			(Click to select)Common StockRetained EarningsInterest ReceivableNotes ReceivableAccounts Receivable
(Click to select)Interest ReceivableCashNotes ReceivableAccounts ReceivableCommon Stock			Total Stockholders' Equity
Total Assets		$	Total Liabilities and Stockholders' Equity		$

Baker Co. Statement of Cash Flows For the Year Ended 2010
Cash Flow From Operating Activities:
(Click to select)Inflow from CustomersCash Inflow from Stock IssuedOutflow for Notes ReceivableBeginning Cash BalanceCash Outflow for Dividends	$
(Click to select)Cash Outflow for DividendsCash Inflow from Stock IssuedOutflow for ExpensesBeginning Cash BalanceOutflow for Notes Receivable	()
Net Cash Flow from Operating Activities		$
Cash Flows From Investing Activities:
(Click to select)Cash Inflow from Stock IssuedOutflow for Notes ReceivableCash Outflow for DividendsOutflow for ExpensesInflow from Customers		()
Cash Flow From Financing Activities:
(Click to select)Outflow for Notes ReceivableOutflow for ExpensesInflow from CustomersBeginning Cash BalanceCash Inflow from Stock Issued
(Click to select)Inflow from CustomersOutflow for ExpensesBeginning Cash BalanceOutflow for Notes ReceivableCash Outflow for Dividends	()
Net cash Flow from Financing Activities
Net Change in Cash
(Click to select)PlusLess: (Click to select)Beginning Cash BalanceCash Inflow from Stock IssuedOutflow for Notes ReceivableInflow from CustomersOutflow for Expenses
Ending Cash Balance		$