Problem 1-33A (Algo) Preparing financial statements for two complete accounting cycles LO 1-3, 1-4, 1-5, 1-7, 1-8, 1-9
Mark's Consulting experienced the following transactions for Year 1, its first year of operations, and Year 2. Assume that all transactions involve the receipt or payment of cash.
Transactions for Year 1:
1. Acquired $80,000 by issuing common stock.
2. Received $130,000 cash for providing services to customers.
3. Borrowed $21,000 cash from creditors.
4. Paid expenses amounting to $54,000.
5. Purchased land for $40,000 cash.
Transactions for Year 2:
Beginning account balances for Year 2 are:
Cash Land Notes payable Common stock Retained earnings
$137,000 $40,000 $21,000 $80,000 $76,000
1. Acquired an additional $26,000 from the issue of common stock.
2. Received $136,000 for providing services.
3. Paid $16,000 to creditors to reduce loan.
4. Paid expenses amounting to $69,000.
5. Paid a $12,000 dividend to the stockholders.
6. Determined that the market value of the land is $50,000.
