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During Year 1, Hardy Merchandising Company purchased $24,000 of inventory on account. Hardy sold inventory on account that cost $18,000 for $27,000. Cash payments on accounts payable were $15,000. There was $24,000 cash collected from accounts receivable. Hardy also paid $4,400 cash for operating expenses. Assume that Hardy started the accounting period with $20,000 in both cash and common stock. Required a. Identify the events described in the preceding paragraph and show them in a horizontal statements model. The first event is recorded as an example. b. What is the balance of accounts receivable at the end of Year 1? c. What is the balance of accounts payable at the end of Year 1? d. What are the amounts of gross margin and net income for Year 1? e. Determine the amount of net cash flow from operating activities.

During Year 1, Hardy Merchandising Company purchased $24,000 of inventory on account. Hardy sold inventory on account that cost $18,000 for $27,000. Cash payments on accounts payable were $15,000. There was $24,000 cash collected from accounts receivable. Hardy also paid $4,400 cash for operating expenses. Assume that Hardy started the accounting period with $20,000 in both cash and common stock. Required a. Identify the events described in the preceding paragraph and show them in a horizontal statements model. The first event is recorded as an example. b. What is the balance of accounts receivable at the end of Year 1? c. What is the balance of accounts payable at the end of Year 1? d. What are the amounts of gross margin and net income for Year 1? e. Determine the amount of net cash flow from operating activities.

Corporate Financial Accounting
Corporate Financial Accounting
14th Edition
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter5: Accounting For Merchandising Businesses
Section: Chapter Questions
Problem 5.5BPR: Multiple-step income statement and balance sheet The following selected accounts and their current...
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nework 1 i Saved Help Sav During Year 1, Hardy Merchandising Company purchased $24,000 of inventory on account. Hardy sold inventory on account that cost $18,000 for $27,000. Cash payments on accounts payable were $15,000. There was $24,000 cash collected from accounts receivable. Hardy also paid $4,400 cash for operating expenses. Assume that Hardy started the accounting period with $20,000 in both cash and common stock. Required a. Identify the events described in the preceding paragraph and show them in a horizontal statements model. The first event is recorded as an example. b. What is the balance of accounts receivable at the end of Year 1? c. What is the balance of accounts payable at the end of Year 1? d. What are the amounts of gross margin and net income for Year 1? e. Determine the amount of net cash flow from operating activities. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Identify the events described in the preceding paragraph and record them in a horizontal statements model. The first event is recorded as an example.
Transcribed Image Text:nework 1 i Saved Help Sav During Year 1, Hardy Merchandising Company purchased $24,000 of inventory on account. Hardy sold inventory on account that cost $18,000 for $27,000. Cash payments on accounts payable were $15,000. There was $24,000 cash collected from accounts receivable. Hardy also paid $4,400 cash for operating expenses. Assume that Hardy started the accounting period with $20,000 in both cash and common stock. Required a. Identify the events described in the preceding paragraph and show them in a horizontal statements model. The first event is recorded as an example. b. What is the balance of accounts receivable at the end of Year 1? c. What is the balance of accounts payable at the end of Year 1? d. What are the amounts of gross margin and net income for Year 1? e. Determine the amount of net cash flow from operating activities. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Identify the events described in the preceding paragraph and record them in a horizontal statements model. The first event is recorded as an example.
Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Identify the events described in the preceding paragraph and record them in a horizontal statements model. The first event is recorded as an example. (In the Cash Flow c financing activities, "NC" for net change in cash and "NA" for not affect. Enter any decreases to account balances with a minus sign.) HARDY MERCHANDISING COMPANY es Effect of Events on the Financial Statements Balance Sheet Income Statement Assets Liabilities Stockholders' Equity Statement of Cash Flows %3D Revenue Expenses Net Income %3D Events Cash Accounts Accounts Common Retained Inventory %3D + Receivable Payable Stask Earnings Beg. bal. 20,000 20,000 NA 1. Pur. inv. 2a. Sold inv. 2b. Inv. cost 3. Pd. AP 4. Coll. AR 5. Pd. exp. End, bal. + panbe Required A Required B Prev 1 of 9 Next > ...
Transcribed Image Text:Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Identify the events described in the preceding paragraph and record them in a horizontal statements model. The first event is recorded as an example. (In the Cash Flow c financing activities, "NC" for net change in cash and "NA" for not affect. Enter any decreases to account balances with a minus sign.) HARDY MERCHANDISING COMPANY es Effect of Events on the Financial Statements Balance Sheet Income Statement Assets Liabilities Stockholders' Equity Statement of Cash Flows %3D Revenue Expenses Net Income %3D Events Cash Accounts Accounts Common Retained Inventory %3D + Receivable Payable Stask Earnings Beg. bal. 20,000 20,000 NA 1. Pur. inv. 2a. Sold inv. 2b. Inv. cost 3. Pd. AP 4. Coll. AR 5. Pd. exp. End, bal. + panbe Required A Required B Prev 1 of 9 Next > ...
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