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Use the following information to answer next 8 questions. Rose opened an Office Cleaning Service company on January 1, 2020. During the year she had
Use the following information to answer next 8 questions. Rose opened an Office Cleaning Service company on January 1, 2020. During the year she had the following transactions.
- She started the business with investing $30,000 of her own money (business was organized as corporation)
- She purchased $15,000 of furniture and equipment in cash.
- She purchased a truck for $28,000 for business use - paid $5,000 in cash and signed a 3-year note for the rest.
- She borrowed $20,000 from bank by issuing a 5-year note.
- During the year, provided $70,000 services to customers of which $66,000 was collected, the rest was not yet collected as of Dec. 31st.
- During the year, she incurred $55,000 of salaries, rent, utilities, and insurance expenses of which $3000 was still not paid as of Dec. 31st.
- During the year, she paid $4,000 to bank of which $1200 was for interest and the rest was for payment of the principal of the loan.
- During the year, she took $8,000 as dividend (dividends paid to shareholders).
- During the year, purchased $2000 of supplies in cash. Only $800 of the supplies was left on Dec. 31st.
- She sold $800 of unnecessary equipment in cash at cost.
- Depreciation expense for the year was $1,000.
- She collected $3,000 from a customer in advance for services to be rendered next year.
- Compute net cash flows from operating activities.
- Compute net cash flows from investing activities.
- Compute net cash flow from financing activities.
- Compute total change in cash during the year.
- Compute total revenues for the year.
- Compute total expense for the year.
- Compute net income for the year.
- Compute Ann's total equity in business as of Dec. 31st.
- Compute total expense for the year.
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