Hart, Attorney at Law, experienced the following transactions in Year 1, the first year of operations:

1. Accepted $15,200 on April 1, Year 1, as a retainer for services to be performed evenly over the next 12 months

2. Performed legal services for cash of $68,000

3. Purchased $1,400 of office supplies on account

4. Paid $1,260 of the amount due on accounts payable

5. Paid a cash dividend to the stockholders of $5,600

6. Paid cash for operating expenses of $19,600

7. Determined that at the end of the accounting period $120 of office supplies remained on hand

8. On December 31, Year 1, recognized the revenue that had been earned for services performed in accordance with Transaction 1.

Show the effects of the events on the financial statements using a horizontal statement model.

Question

Business

Marley Riggs

20 August, 19:28

Hart, Attorney at Law, experienced the following transactions in Year 1, the first year of operations:

1. Accepted $15,200 on April 1, Year 1, as a retainer for services to be performed evenly over the next 12 months

2. Performed legal services for cash of $68,000

3. Purchased $1,400 of office supplies on account

4. Paid $1,260 of the amount due on accounts payable

5. Paid a cash dividend to the stockholders of $5,600

6. Paid cash for operating expenses of $19,600

7. Determined that at the end of the accounting period $120 of office supplies remained on hand

8. On December 31, Year 1, recognized the revenue that had been earned for services performed in accordance with Transaction 1.

Show the effects of the events on the financial statements using a horizontal statement model.

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Answers (1)

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Skyler Mcintosh · Answer 1

Asset liability equity Revenue Expenses

1) 15200 (15200) (15200)

2) 68000 68000 68000

3) 1400 1400 1400

4 (1260) (1260) 1260

5 (5600) (5600) 5600

6 (19600) (19600) 19600

7 (1280) (1280) 1400

8 11400 11400

56860 140 37720 64200 29260