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4 Exercise 7-13A (Algo) Effect of credit card sales on financial statements LO 7-6 -6 Ints kipped Ultra Day Spa provided $88,900 of services during Year 1. All customers paid for the services with credit cards. Ultra submitted the credit card receipts to the credit card company immediately. The credit card company paid Ultra cash in the amount of face value less a 4 percent service charge. Required a. Show the credit card sales (Event 1) and the subsequent collection of accounts receivable (Event 2) In a horizontal statements model in the Statement of Cash Flows column, indicate whether the item is an operating activity (OA). Investing activity (A), or financing activity (FA). b. Based on this information alone, answer the following questions: (1) What is the amount of total assets at the end of the accounting period? (2) What is the amount of revenue reported on the income statement? (3) What is the amount of cash flow from operating activities reported on the statement of cash flows? Book Hint Print Complete this question by entering your answers in the tabs below. ference Required Required B Show the credit card sales (Event 1) and the subsequent collection of accounts receivable (Event 2) in a horizontal statements model. (Enter any decreases to account balances and cash outflows with a minus sign. For changes on the Statement of Cash Flows, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Not all cells require input.) Show less ULTRA DAY SPA Horizontal Statements Model Balance Sheet Income Statement Stockholders Statement Assets Event Equity of Cash Liability Account Retained Net Flows Cash + Recevable Revenue Earnings Expense Income 1. 2. + Requind A Required B > DU 4 Exercise 7-13A (Algo) Effect of credit card sales on financial statements LO 7-6 66 oints Skipped Ultra Day Spa provided $88.900 of services during Year 1. All customers paid for the services with credit cards. Ultra submitted the credit card receipts to the credit card company immediately. The credit card company paid Ultra cash in the amount of face value less a 4 percent service charge. Required a. Show the credit card sales (Event 1) and the subsequent collection of accounts receivable (Event 2) in a horizontal statements model. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA). investing activity (A), or financing activity (FA). b. Based on this information alone, answer the following questions: ( What is the amount of total assets at the end of the accounting period? (2) What is the amount of revenue reported on the income statement? (3) What is the amount of cash flow from operating activities reported on the statement of cash flows? eBook Hint Print Complete this question by entering your answers in the tabs below. Reference Required Required B Based on this information alone, answer the following questions: (For all requirements, round your answers to the nearest whole dollar.) (1) What is the amount of total assets at the end of the accounting period? (2) What is the amount of revenue reported on the income statement? (3) What is the amount of cash flow from operating activities reported on the statement of cash flows? Show less (0) Total assets (2) Revenue recognized Cash flow from operating (3) activities

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