Tuesday, March 21, 2021 10:30 AM Question-1 Marks-20 Sherman Lawn Service has been open for one year, and Hannah Sherman, the owner, wants to know whether the business carned a net income or a net loss for the year. First, she must identify the revenues earned and the expenses incurred during the year. Requirements 1. What are revenues and expenses? 2. If reventes increase, what would be the effect, if any, on equity Question-2 Marks-20 Suppose you are the manager of Greg's Tunes. The company needs a bank loan in order to purchase music equipment. In evaluating the loan request, the banker asks about the assets and liabilities of the business. In particular, the banker wants to know the amount of the business's owner's equity. Requirements 1. Is the banker considered an intemal or external user of financial information? 2. Which financial statement would provide the best information to answer the banker's questions? Question-3 Marks-40 Turtle Creek earns service revenue by caring for the pets of customers. Turtle Creek's main expense is the salary paid to an employee. Requirement 1. Write the accounting equation for the following transactions a. Received S320 cash for service revenue carried b. Paid S125 cash for salary expense. c. Eamed S440 for service revenue, but the customer lus not paid Turtle Creek yet. d. Received utility bill of $65, which will be paid next month. Question-4 Marks-20 Bob Martin Deliveries collected cash on account from a client for whom the business hnd provided delivery services one month earlier. Requirements 1. Why didn't the business record revenue when it collected the cash on account? 2. Write two accounting equations to show the effects of a. receiving cash of $500 for service revenue eamed. b. receiving eash of $500 from a customer on account