Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The trial balance of Pacilio Security Services Inc. as of January 1, 2013, had the following normal balances: Cash $ 8,900 Accounts Receivable 1,500 Supplies

The trial balance of Pacilio Security Services Inc. as of January 1, 2013, had the following normal balances:

Cash $ 8,900
Accounts Receivable 1,500
Supplies 65
Prepaid Rent 800
Land 4,000
Accounts Payable 1,050
Unearned Revenue 200
Salaries Payable 1,200
Notes Payable 2,000
Common Stock 8,000
Retained Earnings 2,815
During 2013, Pacilio Security Services experienced the following transactions:
1. Paid the salaries payable from 2012.
2.

Paid the balance of $2,000 on the debt owed to the Small Business Government Agency. The loan is interest free.

3.

Performed $32,000 of security services for numerous local events during the year; $21,000 was on account and $11,000 was for cash.

4. On May 1, paid $3,000 for 12 months rent in advance.
5.

Purchased supplies on account for $700.

6.

Paid salaries expense for the year of $9,000.

7. Incurred other operating expenses on account, $4,200.
8. On October 1, 2013, a customer paid $1,200 for services to be provided over the next 12 months.
9. Collected $19,000 of accounts receivable during the year.
10. Paid $5,950 on accounts payable.
11. Paid $1,800 of advertising expenses for the year.
12. Paid a cash dividend to the shareholders of $4,650.
13. The market value of the land was determined to be $5,500 at December 31, 2013.
Adjustments
14. There was $120 of supplies on hand at the end of the year.
15. Recognized the expired rent.
16. Recognized the earned revenue from 2012 and transaction no. 8.
17. Accrued salaries were $1,000 at December 31, 2013.

Indicate whether the transaction increases (+), decreases (), or increases and decreases (+/-) for each element of the financial statements. Also, in the Cash Flow column, use the letters OA to designate operating activity, IA for investing activity, FA for financing activity. The first transaction is recorded as an example.

Pacilio Security Services, Inc.
Effect of Transactions on Financial Statements - 2013
Transaction Balance Sheet Income Statement Statement of Cash Flows
Assets = Liabilities + S. Equity Revenue Expenses = Net Income
1. OA
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Petroleum Accounting: Principles, Procedures; And Issues

Authors: Dennis Jennings, John Brady, Rich Shappard, Craig Friou

8th Edition

0940966328, 978-0940966321

More Books

Students also viewed these Accounting questions

Question

=+a) Draw the decision tree.

Answered: 1 week ago