Chapter 1 Hw
Exercises
1-1
Year 1 Year 2
Net Operating Cash Flows
Cash collected from customers $160,000 $190,000
Cash disbursements: Salaries paid for services rendered (90,000) (100,000) Utilities (30,000) (40,000) Purchase of insurance policy (60,000) -0-
Net operating cash flow $(20,000) $50,000
Income Statement
Year 1 Year 2
Revenues $170,000 $220,000
Expenses:
Salaries (90,000) (100,000) Insurance Policy (20,000) (20,000) Utilities (35,000) (35,000) Total Expenses (145,000) (155,000)
Net Income $25,000 $65,000
Year 1:
Accounts Receivable: $170,000 – $160,000 = $10,000
Year 2:
Accounts receivable from year 1 + amount billed to customers in year 2 – cash collected from year 2
$10,000 + 220,000 - $190,000 = $40,000
1-2 RPG Consulting Income Statement Year 2 Year 3
Revenues $350,000 $450,000
Expenses:
Salaries (140,000) (160,000) Insurance Policy (40,000) (40,000) Travel and entertainment (30,000) (40,000) Advertising (25,000) (20,000) Total Expenses (235,000) (260,000)
Net Income $115,000 $190,000
Amount owed at the end of year 1 $ 5,000
Amount incurred in year 2 25,000
Total amount owed at the end of year 2 30,000
Advertising cash disbursement in year 2 (15,000)
Amount owed at the end of year 2 $ 15,000
Advertising cash disbursement in year 3 (35,000)
Advertising expense at the end of year 3 $ 20,000
1-4
1. Topic # for business combination: ASC 805
2. Topic # for related party disclosures: ASC 850
3. Topic, subtopic, and section # for the initial measurement of internal-use software: ASC 350 – 40 – 30
4. Topic, subtopic, and section # for the subseq. measure of asset retirement oblig.: ASC 980 – 410 – 35
5. Topic, subtopic, and section # for the recognition of stock compensation: ASC 505 –
1-1
Year 1 Year 2
Net Operating Cash Flows
Cash collected from customers $160,000 $190,000
Cash disbursements: Salaries paid for services rendered (90,000) (100,000) Utilities (30,000) (40,000) Purchase of insurance policy (60,000) -0-
Net operating cash flow $(20,000) $50,000
Income Statement
Year 1 Year 2
Revenues $170,000 $220,000
Expenses:
Salaries (90,000) (100,000) Insurance Policy (20,000) (20,000) Utilities (35,000) (35,000) Total Expenses (145,000) (155,000)
Net Income $25,000 $65,000
Year 1:
Accounts Receivable: $170,000 – $160,000 = $10,000
Year 2:
Accounts receivable from year 1 + amount billed to customers in year 2 – cash collected from year 2
$10,000 + 220,000 - $190,000 = $40,000
1-2 RPG Consulting Income Statement Year 2 Year 3
Revenues $350,000 $450,000
Expenses:
Salaries (140,000) (160,000) Insurance Policy (40,000) (40,000) Travel and entertainment (30,000) (40,000) Advertising (25,000) (20,000) Total Expenses (235,000) (260,000)
Net Income $115,000 $190,000
Amount owed at the end of year 1 $ 5,000
Amount incurred in year 2 25,000
Total amount owed at the end of year 2 30,000
Advertising cash disbursement in year 2 (15,000)
Amount owed at the end of year 2 $ 15,000
Advertising cash disbursement in year 3 (35,000)
Advertising expense at the end of year 3 $ 20,000
1-4
1. Topic # for business combination: ASC 805
2. Topic # for related party disclosures: ASC 850
3. Topic, subtopic, and section # for the initial measurement of internal-use software: ASC 350 – 40 – 30
4. Topic, subtopic, and section # for the subseq. measure of asset retirement oblig.: ASC 980 – 410 – 35
5. Topic, subtopic, and section # for the recognition of stock compensation: ASC 505 –