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Malco Enterprises issued $17,000 of common stock when the company was started. In addition, Malco borrowed $43,000 from a local bank on July 1, Year 1. The note had a 6 percent annual interest rate and a one-year term to maturity. Malco Enterprises recognized $80,200 of revenue on account in Year 1 and $92,200 of revenue on account in Year 2. Cash collections of accounts receivable were $68,300 in Year 1 and $78,500 in Year 2. Malco paid $45,300 of other operating expenses in Year 1 and $52,000 of other operating expenses in Year 2. Malco repaid the loan and interest at the maturity date. Required Based on this information given above, record the events in the accounting equation and answer the following questions. (Enter any decreases to account balances with a minus sign.)

MALCO ENTERPRISES

Effect of Events on the Financial Statements

Balance Sheet

Assets

=

Liabilities

+

Stkholders Equity

Events

Cash

+

Accounts Receivable

Notes Payable

+

Interest Payable

Common Stock

+

Retained Earnings

Year 1

1.

Com. Stock

2.

Loan

3.

Rev.

4.

Coll. AR

5.

Op. Exp.

6.

Int. Acc.

End. Bal.

+

=

+

+

+

Year 2

Beg. Bal.

1.

Rev.

2.

Coll. AR

3.

Op. Exp.

4.

Int. Acc.

5.

Pay Int. & Prin.

End. Bal.

+

=

+

+

+

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