50.1K

Verified Solution

Link Copied!

As of January 1, 2018, Room Designs, Inc. had a balance of $4,900 in Cash, $2,700 in Common Stock, and $2,200 in Retained Earnings. These were the only accounts with balances in the ledger on January 1, 2018. Further analysis of the company's cash account indicated that during the 2018 accounting period, the company had (1) net cash inflow from operating activities of $5,300, (2) net cash outflow for investing activities of $13,400, and (3) net cash inflow from financing activities of $11,200. All revenue and expense events were cash events. The following accounts and balances represent the general ledger of Room Designs, Inc. as of December 31, 2018, before closing. Assets Cash Bal. 8,000 ROOM DESIGNS, INC. General Ledger Liabilities Stockholders' Equity Notes Payable Common Stock Revenue Bal. Bal. 10, 200 Bal. 10,300 5,000 Land 13,400 Retained Earnings Bal. 2,200 Expenses Bal. 5,000 Bal. Dividends Bal. 1,300 Required a. Assume that the net cash inflow from financing activities of $11,200 was caused by three events. Based on the information above, identify these events and determine the cash flow associated with each event. b. What did the company purchase that resulted in the cash outflow from investing activities? C-1. Prepare an income statement for the year ended December 31, 2018. c-2. Prepare a statement of changes in stockholders' equity for the year ended December 31, 2018. C-3. Prepare a balance sheet as of December 31, 2018. C-4. Prepare a statement of cash flows for the year ended December 31, 2018

Answer & Explanation Solved by verified expert

See Answer