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The following transactions pertain to Accounting Solutions Inc. Assume the transactions for the purchase of the computer and any capital improvements occur on January 1 each year. Year 1 1. Acquired $63,000 cash from the issue of common stock. 2. Purchased a computer system for $22,700. It has an estimated useful life of five years and a $2,810 salvage value. 3. Paid $2,000 sales tax on the computer system. 4. Collected $36,230 in fees from clients. 5. Pald $1.490 in fees for routine maintenance to service the computers. 6. Recorded double-declining balance depreciation on the computer system for Year 1. Year 2 1. Paid $670 for repairs to the computer system. 2. Bought off-site backup services to maintain the computer system. $1,220. 3. Collected $39,230 in fees from clients. 4. Paid $960 in fees to service the computers. 5. Recorded double-declining balance depreciation for Year 2. Year 3 1. Paid $3,400 to upgrade the computer system, which extended the total life of the system to six years. The salvage value did not change 2. Paid $810 in fees to service the computers. 3. Collected $32,390 In fees from clients. 4. Recorded double-declining-balance depreciation for Year 3. Required a. Record the above transactions in a horizontal statements model. b-1. Prepare income statements for Year 1 Year 2, and Year 3. b-2. Prepare statements of changes in stockholders' equity for Year 1, Year 2and Year 3. b-3. Prepare balance sheets for Year 1, Year 2, and Year 3. b-4. Prepare statements of cash flows for Year 1, Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Req A Year 1 Req A Year 2 Reg A Year 3 Req B1 Inc Stmt Req B2 Stmt of Changes Reg B3 Bal Sheet Req B4 Cash Flows Record the above transactions in a horizontal statements model for Year 1. (In the Cash Flow column, indicate whether the item is an operating investing activity (IA), a financing activity (FA), or net change in cash (NC). If an element is not affected by the event, leave the cell blank. Ent account balances and cash outflows with a minus sign. Not all cells will require entry.) Event Year 1 ACCOUNTING SOLUTIONS INC. Horizontal Statements Model - Year 1 Balance Sheet Income Statement Assets Stockholders' Equity BV Retained Revenue Expense Common = Net Income Cash Equipment Stock Earnings 63,000+ 63,000 Statement of Cash Flows 1. 2. + + + + 3 ###### 4. 5. 6. Bal 63,000 + 0 63,000 + 0 0 0- 0 0 a. Record the above transactions in a horizontal statements model. b-1. Prepare income statements for Year 1, Year 2, and Year 3. b-2. Prepare statements of changes in stockholders' equity for Year 1 Year 2, and Year 3. b-3. Prepare balance sheets for Year 1 Year 2, and Year 3. b-4. Prepare statements of cash flows for Year 1, Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Reg A Year 1 Req Alpear 2 Reg A Year 3 Req B1 Inc Stmt Req B2 Stmt of Changes Req B3 Bal Sheet Req B4 Cash Flows Record the above transactions in a horizontal statements model for Year 2. (In the Cash Flow column, indicate whether the item is an opera investing activity (IA), a financing activity (FA), or net change in cash (NC). If an element is not affected by the event, leave the cell blank. account balances and cash outflows with a minus sign. Not all cells will require entry.) ACCOUNTING SOLUTIONS INC. Horizontal Statements Model - Year 2 Balance Sheet Income Statement Assets Stockholders' Equity BV Common Retained Revenue Expense Net Income Equipment Stock Earnings Event Year 2 Statement of Cash Flows Cash Bal. + ++ 1. 2. 3. 4. 5. Bal. 0 + 0 = 0 + 0 0= 0 0 Required a. Record the above transactions in a horizontal statements model b-1. Prepare income statements for Year 1 Year 2, and Year 3. b-2. Prepare statements of changes in stockholders' equity for Year 1 Year 2, and Year 3 b-3. Prepare balance sheets for Year 1 Year 2, and Year 3. b-4. Prepare statements of cash flows for Year 1, Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Reg A Year 1 Reg A Year 2 Reg A Year 3 Req B1 Inc Stmt Req B2 Stmt of Changes Reg B3 Bal Sheet Req B4 Cash Flows Record the above transactions in a horizontal statements model for Year 3. (In the Cash Flow column, indicate whether the item is an operating ac investing activity (IA), a financing activity (FA), or net change in cash (NC). If an element is not affected by the event, leave the cell blank. Enter a account balances and cash outflows with a minus sign. Not all cells will require entry) ACCOUNTING SOLUTIONS INC. Horizontal Statements Model - Year 3 Balance Sheet Income Statement Assets Stockholders' Equity BV Common Revenue Retained Expense Net Income Equipment Stock Earnings Event Year 3 Statement of Cash Flows Cash Bal. 1. 2 3. 4. Bal 0 0 = 1 ol + 0 0 0 -1. Prepare inc b-2. Prepare statements of changes in stockholders' equity for Year 1 Year 2, and Year 3. b-3. Prepare balance sheets for Year 1 Year 2, and Year 3. b-4. Prepare statements of cash flows for Year 1 Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Req A Year 1 Req A Year 2 Reg A Year 3 Req B1 linc Stmt Req B2 Stmt of Changes Req B3 Bal Sheet Req B4 Cash Flows Prepare income statements for Year 1, Year 2, and Year 3. ACCOUNTING SOLUTIONS INC. Income Statement For the Year Ended December 31 Year 1 Year 2 Year 3 Expenses Total expenses 0 Required a. Record the above transactions in a horizontal statements model. b-1. Prepare income statements for Year 1 Year 2, and Year 3. b-2. Prepare statements of changes in stockholders' equity for Year 1 Year 2, and Year 3. b-3. Prepare balance sheets for Year 1 Year 2, and Year 3. b-4. Prepare statements of cash flows for Year 1. Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Req B4 Cash Flows Req A Year 1 Reg A Year 2 Req A Year 3 Req B1 Inc Reg B2 Sent Req B3 Bal Stmt of Changes Sheet Prepare statements of changes in stockholders' equity for Year 1, Year 2, and Year 3. ACCOUNTING SOLUTIONS INC. Statements of Changes in Stockholders' Equity For the Year Ended December 31 Year 1 Year 2 Year 3 Beginning common stock 0 0 0 Ending common stock Beginning retained earnings 0 0 0 Ending retained earnings Total stockholders' equity $ 0 $ 0 $ 0 b-4. Prepare statements of cash flows for Year 1, Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Req A Year 1 Req A Year 2 Req A Year 3 Req B1 Inc Stmt Reg B2 Stmt of Changes Req B3 Bal Sheet Req B4 Cash Flows Prepare balance sheets for Year 1, Year 2, and Year 3. ACCOUNTING SOLUTIONS INC. Balance Sheet As of December 31 Year 1 Year 2 Year 3 Assets Total Assets $ 0 $ 0 $ 0 Liabilities Stockholders' equity 0 0 0 Total stockholders' equity Total liabilities and stockholders' equity $ 0 $ 0 $ 0 Req A Year 1 Reg A Year 2 Req A Year 3 Req B1 Inc Stmt Reg B2 Stmt of Changes Req B3 Bal Sheet Req B4 Cash Flows Prepare statements of cash flows for Year 1, Year 2, and Year 3. (Cash outflows should be indicated with a minus sign.) ACCOUNTING SOLUTIONS INC Statement of Cash Flows For the Year ended December 31 Year 1 Cash flows from operating activities Year 2 Year 3 0 0 0 Net cash flows from operating activities Cash flows from investing activities 0 0 0 Net cash flows from investing activities Cash flows from financing activities 0 0 0 Net cash flows from financing activities Net change in cash 0 0 0 Ending Cash Balance $ 0 $ 0 $ 0

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