what does the income statement tell you about the assets of this business 650096
Record events in the horizontal statements model
Arnett Co. was started in 2011. During 2011, the company (1) acquired $11,000 cash from the issue of common stock, (2) earned cash revenue of $18,000, (3) paid cash expenses of $10,500, and (4) paid a $1,000 cash dividend to the stockholders.
Required
a. Record these four events in a horizontal statements model. Also, in the Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). The first event is shown as an example.
|
Balance Sheet |
Income Statement |
||||||||||||||
|
Event |
Cash |
= |
N. Pay |
+ |
C. Stock. |
+ |
Ret. Ear. |
Rev. |
Exp. |
= |
Net Inc. |
Statement of |
|||
|
1 |
11,000 |
= |
NA |
+ |
11,000 |
+ |
NA |
NA |
NA |
= |
NA |
11,000 |
FA |
||
b. What does the income statement tell you about the assets of this business?