11 - SOLUTIONS TO EXERCISES - SERIES A - CHAPTER 11...

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Unformatted text preview: SOLUTIONS TO EXERCISES - SERIES A - CHAPTER 11 EXERCISE 11-1A Transactions Cash Acquired from Owner $60,000 Revenues 40,000 Expenses 19,300 Withdrawals 5,000 Mark Pruitt Sole Proprietorship Financial Statements For the Year Ended December 31, 2005 Income Statement Revenues $40,000 Expenses (19,300) Net Income $20,700 Capital Statement Beginning Capital Balance $ -0- Plus: Capital Acquired from Owner 60,000 Plus: Net Income 20,700 Less: Withdrawal by Owner (5,000) Ending Capital Balance $75,700 11-8 11-9 EXERCISE 11-1A (cont.) Mark Pruitt Sole Proprietorship Financial Statements Balance Sheet As of December 31, 2005 Assets Cash $75,700 Total Assets $75,700 Liabilities $ -0- Equity Pruitt, Capital 75,700 Total Liabilities and Equity $75,700 Statement of Cash Flows For the Year Ended December 31, 2005 Cash Flows From Operating Activities: Inflow from Revenues $40,000 Outflow for Expenses (19,300) Net Cash Flow from Operating Activities $20,700 Cash Flows From Investing Activities -0- Cash Flows From Financing Activities: Inflow from Owner 60,000 Outflow for Owner Withdrawals (5,000) 11-10 Net Cash Flow from Financing Activities 55,000 Net Change in Cash 75,700 Plus: Beginning Cash Balance-0- Ending Cash Balance $75,700 11-11 EXERCISE 11-2A Transactions: Cash Contributions J. Harris $ 56,000 40% P. Berryhill 84,000 60% Total $140,000 100% Revenues $ 65,000 Expenses 32,000 Harris Withdrawal 2,000 Berryhill Withdrawal 3,000 HB Partnership Financial Statements For the Year Ended December 31, 2006 Income Statement Revenues $65,000 Expenses (32,000) Net Income $33,000 Capital Statement Beginning Capital Balance $ -0- Plus: Capital Acquired from Owners 140,000 Plus: Net Income 33,000 Less: Withdrawals by Owners (5,000) 11-12 Ending Capital Balance $168,000 11-13 EXERCISE 11-2A (cont.) Prepared for the instructors use: Analysis of Capital Accounts: Harris Berryhill Total Beginning Capital Balance $ -0- $ -0- $ -0- Investments 56,000 84,000 140,000 Net Income 33,000 J. Harris 40% 13,200 P. Berryhill 60% 19,800 Withdrawals (2,000) (3,000) (5,000) Ending Capital Balances $67,200 $100,800 $168,000 11-14 EXERCISE 11-2A (cont.) HB Partnership Financial Statements Balance Sheet As of December 31, 2006 Assets Cash $168,000 Total Assets $168,000 Liabilities $ -0- Equity J. Harris, Capital $ 67,200 P. Berryhill, Capital 100,800 Total Equity 168,000 Total Liabilities and Equity $168,000 Statement of Cash Flows For the Year Ended December 31, 2006 Cash Flows From Operating Activities: Inflow from Revenues $65,000 Outflow for Expenses (32,000) Net Cash Flow from Operating Activities $33,000 Cash Flows From Investing Activities -0- Cash Flows From Financing Activities: Inflow from Partners 140,000 11-15 Outflow for Partners Withdrawals...
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This note was uploaded on 04/10/2008 for the course ACCOUNTING 221 taught by Professor West during the Spring '08 term at UMass (Amherst).

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11 - SOLUTIONS TO EXERCISES - SERIES A - CHAPTER 11...

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