TIN Amed Mustafa Outlook M Question 1 - Chapter 3 Homework Assignment - Connect napter 3 Homework Assignment Saved 1 Exercise 3-4A (Algo) Prepaid items on financial statements LO 3-2 Life, Inc. experienced the following events in Year 1, its first year of operation: 6 nts 1. Performed counseling services for $22,000 cash. 2. On February 1, Year 1, paid $15,000 cash to rent office space for the coming year. 3. Adjusted the accounts to reflect the amount of rent used during the year. eBook Hint Required Based on this information alone: a. Record the events in accounts under an accounting equation. (Enter any decreases to account balances with a minus sign.) Print eferences LIFE, INC. Effect of Events on the Accounting Equation Stockholders' Assets Equity Event Retained Cash Prepaid Rent Earnings 1. Performed services 2. Prepaid rent 3. Used rent Totals Alkhamis Armed Mustafa - Outlook Question 1. Chapter 3 Homework Assignment - Connect 3 Homework Assignment Seved Help b. Prepare an income statement, balance sheet, and statement of cash flows for the Year 1 accounting period. (In statement of cash flows, cash outflows should be indicated with a minus sign.) LIFE, INC Income Statement For the Year Ended December 31, Year 1 LIFE, INC. Balance Sheet As of December 31, Year 1 Assets LIFE, INC. Balance Sheet As of December 31, Year 1 Assets Book Hint Total assets Liabilities Stockholders' Equity Print erences Total stockholders' equity Total liabilities and stockholders' equity LIFE, INC. Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Net change in cash Ending cash balance LOS SOC or equity Total liabilities and stockholders' equity Hint Print References LIFE, INC. Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: Net cash flow from operating activities Cash flows from investing activities Cash flows from financing activities Not change in cash Ending cash balance c. Ignoring all other future events, what is the amount of rent expense that would be recognized in Year 2? Rent expense to be recognized in Year 2