80.2K

Verified Solution

Link Copied!

Maben Company was started on January 1, 2016, and experienced the following events during its first year of operation:

1.	Acquired $30,000 cash from the issue of common stock.
2.	Borrowed $40,000 cash from National Bank.
3.	Earned cash revenues of $48,000 for performing services.
4.	Paid cash expenses of $25,000.
5.	Paid a $1,000 cash dividend to the stockholders.
6.	Acquired an additional $20,000 cash from the issue of common stock.
7.	Paid $10,000 cash to reduce the principal balance of the bank note.
8.	Paid $53,000 cash to purchase land.
9.	Determined that the market value of the land is $75,000.

Required

a.

Record the preceding transactions in the horizontal statements model. Also, in the Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA), net change in cash (NC) and NA to indicate the element is not affected by the event. The first event is shown as an example. (Enter any decreases to account balances and cash outflows with a minus sign.)

MABEN COMPANY Horizontal Statements Model for 2016 Event No. Balance Sheet Income Statement Statement of Cash Flows Assets = Liabilities + Stockholders' Equity Revenue Expense = Net Income Cash + Land = Notes Payable + Common Stock + Retained Earnings 1. 30,000 + = + 30,000 + = 30,000 FA 2. + = + + = 3. + = + + = 4. + = + + = 5. + = + + = 6. + = + + = 7. + = + + = 8. + = + + = 9. + = + + = Total + = 0 + + =

Answer & Explanation Solved by verified expert

See Answer