【正文】 nts Receivable (A) 4,000d.Cash (+A) 2,500Unearned Revenue (+L) 2,500M3–6.e.Cost of Goods Sold (+E, SE) 6,800Inventory (A) 6,800f.Accounts Payable (–L) 800Cash (A) 800g.Wages Expense (+E, SE) 3,500Cash (A) 3,500h.Insurance Expense (+E, SE) 500Prepaid Expenses (+A) 1,00Cash (A) 1,500i.Repairs Expense (+E, SE) 700Cash (A) 700j.Utilities Expense (+E, SE) 900Accounts Payable (+L) 900M3–7.Balance SheetIne StatementAssetsLiabilitiesStockholders’ EquityRevenuesExpensesNet Inea.+15,000NE+15,000+15,000NE+15,000b.+8,000NE+8,000+8,000NE+8,000c.+4,000–4,000NENENENENEd.+2,500+2,500NENENENETransaction (c) results in an increase in an asset (cash) and a decrease in an asset (accounts receivable). Therefore, there is no net effect on assets.M3–8.Balance SheetIne StatementAssetsLiabilitiesStockholders’ EquityRevenuesExpensesNet Inee.–6,800NE–6,800NE+6,800–6,800f.–800–800NENENENEg.–3,500NE–3,500NE+3,500–3,500h.–1,500+1,000NE–500NE+500–500i.–700NE–700NE+700–700j.NE+900–900NE+900–900Transaction (h) results in an increase in an asset (prepaid expenses) and a decrease in an asset (cash). Therefore, the net effect on assets is 500.M3–9.Craig’s Bowling, Inc.Ine StatementFor the Month of July 2014Revenues:Games revenue$15,000Sales revenue8,000Total revenues23,000Expenses:Cost of goods sold6,800Utilities expense900Wages expense3,500Insurance expense500Repairs expense700Total expenses 12,400Net ine$ 10,600M3–10.TransactionO, I, or F Activity (or No Effect) on Statement of Cash FlowsDirection and Amount of Effecta.O+15,000b.O+3,000c.O+4,000d.O+2,500e.NENEf.O800g.O3,500h.O1,500i.O700j.NENEM3–11.Net Ine247。 earnings process is not yet plete.h.NoneNo revenue is earned。 earnings process is not yet plete.l.Sales revenue$9,600m.Sales revenue$300E3–4. ActivityExpense Account Affected Amount of Expense Incurred in Januarya.Utilities expense $3,800b.Advertising expense$321(= $963 x 1 month/3 months) incurred in January.The remainder is a prepaid expense (A) that is not incurred until February and March.c.Salaries expense $201,500 incurred in January.The remaining half was incurred in December.d.None Expense will be recorded when the related revenue has been earned.e.NoneExpense will be recorded in the future when the related revenue has been earned.f.Cost of goods sold $47,500(= 500 books x $95 per book cost)g.NoneDecember expense paid in January.h.Commission expense$15,560i.NoneExpense will be recorded as depreciation (used portion of asset’s cost) over the equipment’s useful life.j.Supplies expense $4,700 (= $3,500 + $2,600 $1,400)k.Wages expense $120 (= 8 hours x $15 per hour)l.Insurance expense $400(= $4,800 247。 equity). Stockholders39。 equity). Together, stockholders39。 equity). Stockholders39。 equity). Stockholders39。 there has been no exchange.E3–10. (continued)Req. 3 Net ine using the accrual basis of accounting:Revenues$19,850($19,000 + $850) – Expenses 16,900($16,500 + $400)Net Ine (accrual basis) $ 2,950Assets=Liabilities+Stockholders’ Equity$12,090$ 7,700 $ 1,70024,800 4,440 7,8202,460 48,500 9,36010,420 2,950 net ine7,40025,300$82,470$60,640$21,830Req. 4Net ine using the cash basis of accounting:Cash receipts$27,650(transactions a through d)– Cash disbursements 19,760(transactions g, i, and k)Net Ine (cash basis) $ 7,890Cash basis net ine ($7,890) is higher than accrual basis net ine ($2,950) because of the differences in the timing of recording revenues versus receipts and expenses versus disbursements between the two methods. The $7,800 higher amount in cash receipts over revenues includes cash received prior to being earned (from (b), $600) and cash received after being earned (in (d), $7,200). The $2,860 higher amount in cash disbursements over expenses includes cash paid after being incurred in the prior period (in (g), $2,300), plus cash paid for supplies to be used and expensed in the future (in (k), $960), less an expense incurred in January to be paid in February (in (e), $400).E3–11.STACEY’S PIANO REBUILDING COMPANYIne Statement (unadjusted)For the Month Ended January 31, 2014Operating Revenues: Rebuilding fees revenue$ 19,000 Total operating revenues19,000Operating Expenses: Wages expense16,500 Utilities expense400 Total operating expenses16,900Operating Ine2,100Other Item: Rent revenue850Net Ine$ 2,950E3–12.TransactionO, I, or F Activity (or No Effect) on Statement of Cash FlowsDirection and Amount of Effecta.O+19,000b.O+600c.O+850d.O+7,200e.NENEf.NENEg.O2,300h.NENEi.O16,500j.F2,200k.O960E3–13.Req. 1 and 2CashAccounts ReceivableSuppliesBeg. 0(a)160,000(c) 50,000(e) 2,600(f) 11,90072,000 (b)10,830 (d) 363 (h)6,280 (i) 600 (j)70,000 (k)Beg. 0(a) 2,000(e) 1,600Beg. 0 (a) 1,20064,4273,6001,200EquipmentBuildingAccounts PayableBeg. 0(a) 18,300(k) 50,000Beg.