What is the net cash provided by operating activities?

Softbyte Inc.

Balance Sheet

December 31, 2016

Assets

Cash $7,000

Accounts Receivable 6,000

Supplies 2,000

Equipment 10,000

Total Assets $25,000

Liabilities & Equity

Accounts Payable $3,000

Common Stock 20,000

Retained Earnings 2,000

Total Liabilities & Equity $25,000

Open the balances in the general ledger (T-accounts).

Post the journal entries from the general journal to the general ledger (T-accounts).

Prepare the four financial statements: Income Statement, Statement of Retained Earnings, Balance Sheet, Statement of Cash Flows (Direct Method or Indirect Method.)

Transaction 1: Investment by Stockholders

Invest $25,000 cash in the business in exchange for $25,000 of common stock.

Journal Entry: Dr. Cr.

Cash 25,000

Common Stock 25,000

Transaction 2: Purchase of Equipment for Cash

Purchases computer equipment for $9,000 cash.

Journal Entry: Dr. Cr.

Equipment 9,000

Cash 9,000

Transaction 3: Purchase of Supplies on Credit

Purchases for $1,800 from Acme Supply Company computer paper and other supplies expected to last several months. Acme agrees to allow Softbyte to pay this bill at a later date.

Journal Entry: Dr. Cr.

Supplies 1,800

Accounts Payable 1,800

Transaction 4: Services Provided for Cash

Receives $1,600 cash from customers for programming services it has provided.

Journal Entry: Dr. Cr.

Cash 1,600

Service Revenue 1,600

Transaction 5: Purchase of Advertising on Credit

Received a bill for $350 from the Daily News for advertising but postpones payment until a later date.

Journal Entry: Dr. Cr.

Advertising Expense 350

Accounts Payable 350

Transaction 6: Services Rendered for Cash and Credit

Provides $3,700 of programming services for customers. The company receives cash of $1,700 from customers, and it bills the balance of $2,000 on account.

Journal Entry: Dr. Cr.

Cash 1,700

Accounts Receivable 2,000

Service Revenue 3,700

Transaction 7: Payment of Expenses

Pays the following expenses in cash: store rent $650, salaries and wages of employees $920, and utilities $230.

Journal Entry: Dr. Cr.

Rent Expense 650

Salary Expense 920

Utilities Expense 230

Cash 1,800

Transaction 8: Payment of Accounts Payable

Pays $500 cash on accounts payable.

Journal Entry: Dr. Cr.

Accounts Payable 500

Cash 500

Transaction 9: Receipt of Cash on Account

Receives $900 in cash from customers who had been billed for services.

Journal Entry: Dr. Cr.

Cash 900

Accounts Receivable 900

Transaction 10: Dividends

The corporation pays a dividend of $1,350 in cash to the stockholders of Softbyte Inc.

Journal Entry: Dr. Cr.

Dividends 1,350

Cash 1,350