Financial Accounting: An Integrated Statements Approach, 2nd Edition

The following amounts were taken from the accounting records of Lisko Services, Inc., as of

December 31, 2007. Lisko Services began its operations on January 1, 2007.

Capital stock $ 14,000

Cash 38,500

Dividends 7,000

Fees earned 321,300

Interest expense 1,680

Land 105,000

Miscellaneous expense 9,520

Notes payable 21,000

Rent expense 33,600

Salaries expense 91,000

Taxes expense 25,200

Utilities expense 44,800

82 Chapter 2 Basic Accounting Concepts

Problem 2-3A

Financial statements

Goals4, 5

1. Net income, $115,500

Statement of Cash Flows

a. Financing 25,000

b. Operating 15,000

c. Operating 2,500

d. Financing 10,000

e. Investing 30,000

f. Operating 1,650

g. Operating 3,500

i. Financing 1,500

Increase in cash 10, 850

Statement of

Cash Flows

Income

Statement

Income Statement

b. 15,000 Fees earned

c.2,500 Rent expense

f. 950 Auto expense

f. 700 Misc. expense

g.3,500 Salary expense

7,350 Net income

b.

c.

f.

g.

INTEGRATED FINANCIAL

STATEMENT FRAMEWORK

a. Investment

b. Fees earned

Balances

c. Rent expense

Balances

d. Issued notes payable

Balances

e. Purchased land

Balances

f. Paid expenses

Balances

g. Paid salary expense

Balances

i. Paid dividends

Balances, Jan. 31

Balance Sheet

Assets  Liabilities  Stockholders’ Equity

Notes Capital Retained

Cash  Land  Payable  Stock  Earnings

25,000 25,000

15,000 15,000

40,000 25,000 15,000

2,500 2,500

37,500 25,000 12,500

10,000 10,000

47,500 10,000 25,000 12,500

30,000 30,000

17,500 30,000 10,000 25,000 12,500

1,650 1,650

15, 850 30,000 10,000 25,000 10, 850

3,500 3,500

12,350 30,000 10,000 25,000 7,350

1,500 1,500

10, 850 30,000 10,000 25,000 5, 850