[The following information applies to the questions displayed below.] Maben Company was started on January 1, Year 1, and experienced the following events during its first year of operation: 1. Acquired $32,000 cash from the issue of common stock. 2. Borrowed $38,000 cash from National Bank. 3. Earned cash revenues of $50,000 for performing services. 4. Paid cash expenses of $46,000. 5. Paid a $1,200 cash dividend to the stockholders. 6. Acquired an additional $22,000 cash from the issue of common stock. 7. Paid $10,000 cash to reduce the principal balance of the bank note. 8. Paid $55,000 cash to purchase land. 9. Determined that the market value of the land is $77,000. quired 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). If the element is not affected by the event, leave the cell blank. The first event is shown as an example. (Enter any decreases to account balances and cash outflows with a minus sign.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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[The following information applies to the questions displayed below.]
Maben Company was started on January 1, Year 1, and experienced the following events during its first year of operation:
1. Acquired $32,000 cash from the issue of common stock.
2. Borrowed $38,000 cash from National Bank.
3. Earned cash revenues of $50,000 for performing services.
4. Paid cash expenses of $46,000.
5. Paid a $1,200 cash dividend to the stockholders.
6. Acquired an additional $22,000 cash from the issue of common stock.
7. Paid $10,000 cash to reduce the principal balance of the bank note.
8. Paid $55,000 cash to purchase land.
9. Determined that the market value of the land is $77,000.
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). If the element is not affected by the event, leave the cell
blank. The first event is shown as an example. (Enter any decreases to account balances and cash outflows with a minus sign.
Not all cells require entry.)
Event
No.
1.
2.
3.
4.
5.
6.
7
8.
9.
Total
Assets
Cash
32,000 +
+
+
+
+
+
+
+
+
32,000+
Land
Balance Sheet
Liabilities + Stockholders' Equity
=
=
=
=
=
0 =
MABEN COMPANY
Horizontal Statements Model for Year 1
Notes
Payable
+
+
+
+
+
+
+
+
+
Common Retained Revenue
Stock Earnings
32,000 +
+
+
+
+
+
+
+
+
+
0 + 32,000+
Income Statement
0
0|-|
Expense
=
0 =
Net
Income
0
Statement of Cash
Flows
32,000 FA
32,000
Transcribed Image Text:[The following information applies to the questions displayed below.] Maben Company was started on January 1, Year 1, and experienced the following events during its first year of operation: 1. Acquired $32,000 cash from the issue of common stock. 2. Borrowed $38,000 cash from National Bank. 3. Earned cash revenues of $50,000 for performing services. 4. Paid cash expenses of $46,000. 5. Paid a $1,200 cash dividend to the stockholders. 6. Acquired an additional $22,000 cash from the issue of common stock. 7. Paid $10,000 cash to reduce the principal balance of the bank note. 8. Paid $55,000 cash to purchase land. 9. Determined that the market value of the land is $77,000. 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). If the element is not affected by the event, leave the cell blank. The first event is shown as an example. (Enter any decreases to account balances and cash outflows with a minus sign. Not all cells require entry.) Event No. 1. 2. 3. 4. 5. 6. 7 8. 9. Total Assets Cash 32,000 + + + + + + + + + 32,000+ Land Balance Sheet Liabilities + Stockholders' Equity = = = = = 0 = MABEN COMPANY Horizontal Statements Model for Year 1 Notes Payable + + + + + + + + + Common Retained Revenue Stock Earnings 32,000 + + + + + + + + + + 0 + 32,000+ Income Statement 0 0|-| Expense = 0 = Net Income 0 Statement of Cash Flows 32,000 FA 32,000
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