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Colton Enterprises experienced the following events for Year 1, the first year of operation: Acquired $55,000...

Colton Enterprises experienced the following events for Year 1, the first year of operation:

Acquired $55,000 cash from the issue of common stock.
Paid $14,000 cash in advance for rent. The payment was for the period April 1, Year 1, to March 31, Year 2.
Performed services for customers on account for $112,000.
Incurred operating expenses on account of $45,000.
Collected $85,500 cash from accounts receivable.
Paid $41,000 cash for salary expense.
Paid $36,000 cash as a partial payment on accounts payable.

Adjusting Entries

Made the adjusting entry for the expired rent. (See Event 2.)
Recorded $6,400 of accrued salaries at the end of Year 1.

Events for Year 2

Paid $6,400 cash for the salaries accrued at the end of the prior accounting period.
Performed services for cash of $61,000.
Purchased $4,800 of supplies on account.
Paid $16,500 cash in advance for rent. The payment was for one year beginning April 1, Year 2.
Performed services for customers on account for $128,000.
Incurred operating expenses on account of $61,500.
Collected $109,000 cash from accounts receivable.
Paid $59,000 cash as a partial payment on accounts payable.
Paid $33,500 cash for salary expense.
Paid a $11,000 cash dividend to stockholders.

Adjusting Entries

Made the adjusting entry for the expired rent. (Hint: Part of the rent was paid in Year 1.)
Recorded supplies expense. A physical count showed that $450 of supplies were still on hand.

d- 3Prepare a balance sheet for Year 1.
d-4. Prepare a statement of cash flows for Year 1. (Amounts to be deducted should be indicated by a minus sign.)
e. Record the entries to close the Year 1 temporary accounts to Retained Earnings in the general journal and post to the T-accounts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

f. Prepare a post-closing trial balance for December 31, Year 1.
g. Repeat parts a through f for Year 2. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Statement of Cash Flows only, items to be deducted must be indicated with a negative amount. )

Expert Solution

ekkarill92 answered 1 year ago

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