Grantham University Ba220 Week 2

EX 2-9A

Therapy Inc.

Event No. Assets = Liab. + Stockholder Equity

Cash + Supplies Acct. Pay. + Com. Stk. + Ret. Earn.

9,000 5,000 4,000

1.) 18,000 18,000

2.) 12,000 12,000

3.) (11,000) (11,000)

Rev. – Exp. = Net Inc. Cash Flows

1.) 18,000 – NA = 18,000 18,000 OA

2.) NA - 12,000 = (12,000) (12,000) OA

3.) NA - 11,000 = (11,000) NA

B.) Net income is money that is not obtained for the specific month it is accounted in; the accrual method of accounting. Net cash is accounted in the month the customer actually pays in.

EX 2-14A

Assets = Liabilities + Stock Equity

Cash + Supplies = Accts. Pay. + Unearn. Rev. Ret. Earn.

1.) 1,500 1,500

2.) 36,000 36,000

3.) 84,000 84,000

4.)...