Question

In: Accounting

Rainey Enterprises loaned $40,000 to Small Co. on June 1, 2018, for one year at 7...

Rainey Enterprises loaned $40,000 to Small Co. on June 1, 2018, for one year at 7 percent interest. Show the effects of the following transactions in a horizontal statements. In the Cash Flow column, indicate wheter the item is an (OA), (IA), or a (FA).

1. The Loan to Small Co.

2. The adjusting entry at December 31, 2018

3. The adjusting entry and collection of the note on June 1, 2019

How would the Horizontal Statements Model look like?

Solutions

Expert Solution

Balance Sheet

Income Statement

Statement of Cash Flows

Asset

Liab

Stckholder's Equity

Event No

Cash

Loan Given

Interest receivable

Payable

Common Stock

Ret Earning

Rev

Exp

Net Income

-40,000

40000

N/A

-40000

N/A

1,633

N/A

1,633

N/A

1,633

N/A

40000

-40000

N/A

40000

2800

N/A

-1633

N/A

1167

N/A

1167

2800

Note-

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ekkarill92 answered 1 year ago

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