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Indicate in which part of the statement of cash flows each item would appear: operating activities, investing activities, or financing activities.

(a)				Cash received from customers.
(b)				Cash paid to stockholders (dividends).
(c)				Cash received from issuing new common stock.
(d)				Cash paid to suppliers.
(e)				Cash paid to purchase a new office building.

At the beginning of the year, Goren Company had total assets of $849,800 and total liabilities of $596,700. (Treat each item independently.) (a) If total assets increased $144,300 during the year and total liabilities decreased $73,400, what is the amount of stockholders’ equity at the end of the year?

Stockholders’ equity

(b) During the year, total liabilities increased $109,800 and stockholders’ equity decreased $65,600. What is the amount of total assets at the end of the year?

Total assets

(c) If total assets decreased $85,400 and stockholders’ equity increased $112,900 during the year, what is the amount of total liabilities at the end of the year?

Total liabilities

Flint Hills Park is a private camping ground near the Lathom Peak Recreation Area. It has compiled the following financial information as of December 31, 2014.

Service revenue (from camping fees)	$137,267	Dividends	$9,361
Sales revenue (from general store)	25,998	Notes payable	51,995
Accounts payable	11,439	Expenses during 2014	131,027
Cash	8,839	Supplies	5,719
Equipment	118,549	Common stock	41,596
		Retained earnings (1/1/2014)	5,200

(a)

Determine Flint Hills Park’s net income for 2014.

Flint Hills Park’s net income for 2014

Suppose the following data are derived from the 2014 financial statements of Southwest Airlines. (All dollars are in millions.) Southwest has a December 31 year-end.

Cash balance, January 1, 2014		$1,424
Cash paid for repayment of debt		126
Cash received from issuance of common stock		114
Cash received from issuance of long-term debt		475
Cash received from customers		9,603
Cash paid for property and equipment		1,571
Cash paid for dividends		13
Cash paid for repurchase of common stock		1,005
Cash paid for goods and services		7,121

(a) After analyzing the data, prepare a statement of cash flows for Southwest Airlines for the year ended December 31, 2014. (List negative amounts either with a negative sign preceding the number e.g. -15,000 or in parenthesis e.g. (15,000). Enter amounts in millions, e.g. 45 million.)

SOUTHWEST AIRLINES Statement of Cash Flows For the Year Ended December 31, 2014 (in millions)

The summaries of data from the balance sheet, income statement, and retained earnings statement for two corporations, Colaw Corporation and Hunter Enterprises, are presented below for 2014. Determine the missing amounts. Assume all changes in stockholders’ equity are due to changes in retained earnings.

	Colaw Corporation		Hunter Enterprises
Beginning of year
Total assets	$105,680		$141,070
Total liabilities	60,160		$	(d)
Total stockholders’ equity	$	(a)	69,520
End of year
Total assets	$	(b)	185,840
Total liabilities	128,510		56,640
Total stockholders’ equity	52,010		$	(e)
Changes during year in retained earnings
Dividends	$	(c)	5,970
Total revenues	215,200		$	(f)
Total expenses	165,000		84,570

On June 1, Hightower Service Co. was started with an initial investment in the company of $22,380 cash. Here are the assets, liabilities, and common stock of the company at June 30, and the revenues and expenses for the month of June, its first month of operations:

Cash	$ 4,941	Notes payable	$12,682
Accounts receivable	4,471	Accounts payable	971
Service revenue	7,841	Supplies expense	1,062
Supplies	2,338	Maintenance and repairs expense	662
Advertising expense	400	Utilities expense	238
Equipment	26,341	Salaries and wages expense	1,741
Common stock	22,380

In June, the company issued no additional stock but paid dividends of $1,680.

(a1)

Prepare an income statement for the month of June.

HIGHTOWER SERVICE CO. Income Statement For the Month Ended June 30, 2014

		$

	$





		$

These items are taken from the financial statements of Tresh Corporation for 2014.

Retained earnings (beginning of year)		$31,000
Utilities expense		2,000
Equipment		66,000
Accounts payable		18,300
Cash		10,100
Salaries and wages payable		3,000
Common stock		12,000
Dividends		12,000
Service revenue		68,000
Prepaid insurance		3,500
Maintenance and repairs expense		1,800
Depreciation expense		3,600
Accounts receivable		11,700
Insurance expense		2,200
Salaries and wages expense		37,000
Accumulated depreciation—equipment		17,600

Prepare an income statement for the year ended December 31, 2014.

TRESH CORPORATION Income Statement For the Year Ended December 31, 2014

		$

	$





		$

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Prepare a retained earnings statement for the year ended December 31, 2014. (List items that increase retained earnings first.)

TRESH CORPORATION Retained Earnings Statement For the Year Ended December 31, 2014
	$
:

:
	$

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Prepare a classified balance sheet as of December 31, 2014. (List current assets in order of liquidity.)

TRESH CORPORATION Balance Sheet December 31, 2014
Assets

	$


		$


:
		$
Liabilities and Stockholders' Equity

	$

		$




		$

The Sequel Theater Inc. was recently formed. It began operations in March 2014. The Sequel is unique in that it will show only triple features of sequential theme movies. On March 1, the ledger of The Sequel showed Cash $16,000; Land $38,000; Buildings (concession stand, projection room, ticket booth, and screen) $22,000; Equipment $16,000; Accounts Payable $12,000; and Common Stock $80,000. During the month of March, the following events and transactions occurred.

Mar. 2		Rented the three Star Wars movies (Star Wars®, The Empire Strikes Back, and The Return of the Jedi) to be shown for the first three weeks of March. The film rental was $10,000; $2,000 was paid in cash and $8,000 will be paid on March 10.
3		Ordered the first three Star Trek movies to be shown the last 10 days of March. It will cost $500 per night.
9		Received $9,900 cash from admissions.
10		Paid balance due on Star Wars movies' rental and $2,900 on March 1 accounts payable.
11		The Sequel Theater contracted with J. Russo to operate the concession stand. Russo agrees to pay The Sequel 15% of gross receipts, payable monthly, for the rental of the concession stand.
12		Paid advertising expenses $500.
20		Received $8,300 cash from customers for admissions.
20		Received the Star Trek movies and paid rental fee of $5,000.
31		Paid salaries of $3,800.
31		Received statement from J. Russo showing gross receipts from concessions of $10,000 and the balance due to The Sequel of $1,500 ($10,000 × .15) for March. Russo paid half the balance due and will remit the remainder on April 5.
31		Received $20,000 cash from customers for admissions.

Using T-accounts, enter the beginning balances to the ledger.

Cash

Land

Buildings

Equipment

Accounts Payable

Common Stock

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Journalize the March transactions. The Sequel records admission revenue as service revenue, concession revenue as sales revenue, and film rental expense as rent expense. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Date	Account Titles and Explanation	Debit	Credit



















Mar. 31

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Post the March journal entries to the ledger. (Post entries in the order of information presented in the question.)

Cash
3/1	Bal.	16,000





Accounts Receivable


Land
3/1	Bal.	38,000

Buildings
3/1	Bal.	22,000

Equipment
3/1	Bal.	16,000

Accounts Payable
			3/1	Bal.	12,000


Common Stock
			3/1	Bal.	80,000

Service Revenue




Sales Revenue


Advertising Expense


Rent Expense



Salaries and Wages Expense

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Prepare a trial balance on March 31, 2014.

SEQUEL THEATER INC. Trial Balance March 31, 2014
	Debit	Credit
	$	$











	$	$

The Solo Hotel opened for business on May 1, 2014. Here is its trial balance before adjustment on May 31.

SOLO HOTEL Trial Balance May 31, 2014
	Debit	Credit
Cash	$ 2,500
Supplies	2,600
Prepaid Insurance	1,800
Land	15,000
Buildings	70,000
Equipment	16,800
Accounts Payable		$ 4,700
Unearned Rent Revenue		3,300
Mortgage Payable		36,000
Common Stock		60,000
Rent Revenue		9,000
Salaries and Wages Expense	3,000
Utilities Expense	800
Advertising Expense	500
	$113,000	$113,000

Other data:

1.		Insurance expires at the rate of $450 per month.
2.		A count of supplies shows $1,050 of unused supplies on May 31.
3.		Annual depreciation is $3,600 on the building and $3,000 on equipment.
4.		The mortgage interest rate is 6%. (The mortgage was taken out on May 1.)
5.		Unearned rent of $2,500 has been earned.
6.		Salaries of $900 are accrued and unpaid at May 31.

(e) Identify which accounts should be closed on May 31.

The Solo Hotel opened for business on May 1, 2014. Here is its trial balance before adjustment on May 31.

SOLO HOTEL Trial Balance May 31, 2014
	Debit	Credit
Cash	$ 2,500
Supplies	2,600
Prepaid Insurance	1,800
Land	15,000
Buildings	70,000
Equipment	16,800
Accounts Payable		$ 4,700
Unearned Rent Revenue		3,300
Mortgage Payable		36,000
Common Stock		60,000
Rent Revenue		9,000
Salaries and Wages Expense	3,000
Utilities Expense	800
Advertising Expense	500
	$113,000	$113,000

Other data:

1.		Insurance expires at the rate of $450 per month.
2.		A count of supplies shows $1,050 of unused supplies on May 31.
3.		(a) Annual depreciation is $3,600 on the building.
		(b) Annual depreciation is $3,000 on equipment.
4.		The mortgage interest rate is 6%. (The mortgage was taken out on May 1.)
5.		Unearned rent of $2,500 has been earned.
6.		Salaries of $900 are accrued and unpaid at May 31.

Journalize the adjusting entries on May 31. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

No.	Account Titles and Explanation	Debit	Credit
1.

2.

3 (a).

3 (b).

4.

5.

6.

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Prepare a ledger using T-accounts. Enter the trial balance amounts and post the adjusting entries. (Post entries in the order of journal entries presented in the previous question.)

Cash

Prepaid Insurance


Supplies


Land

Building

Accumulated Depreciation-Building


Equipment

Accumulated Depreciation-Equipment


Accounts Payable

Unearned Rent Revenue


Salaries and Wages Payable


Interest Payable


Mortgage Payable

Common Stock

Rent Revenue



Salaries and Wages Expense



Utilities Expense

Advertising Expense

Interest Expense


Insurance Expense


Supplies Expense


Depreciation Expense

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Prepare an adjusted trial balance on May 31.

SOLO HOTEL Adjusted Trial Balance May 31, 2014
	Debit	Credit
	$	$





















	$	$

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Prepare an income statement for the month of May.

SOLO HOTEL Income Statement For the Month Ended May 31, 2014

		$

	$







		$

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Prepare a retained earnings statement for the month of May.

SOLO HOTEL Retained Earnings Statement For the Month Ended May 31, 2014
	$
:
	$

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Prepare a classified balance sheet at May 31. (List current assets in order of liquidity. List Property, Plant and Equipment in order of Land, Buildings and Equipment .)

SOLO HOTEL Balance Sheet May 31, 2014
Assets

		$


			$


	$
:

:
			$
Liabilities and Stockholders' Equity

		$



			$







			$