Venice Co., which began operations in 2013 (see P-l above) continued in business

Question

Venice Co., which began operations in 2013 (see P-l above) continued in business during 2014. Assume the account balances at January 1, 2014, were: Venice had the following cash transactions during 2014: Purchased land for $8,000. Provided service to customers for $10,000. Owners invested $6,000 in the business. Venice repaid the $5,000 borrowed from toe Local Bank in 2013. (Assume no interest charges). Incurred $4,500 in. expenses. Made a $2,000 distribution to the owners. Required: Explain how each of these transactions would affect Venice's accounting equation using the form provided on the following page. Use brackets, (), to indicate amounts being subtracted. The first transaction has been done as an example. Prepare an income statement, statement of changes in stockholders equity, balance sheet, and statement of cash flows. Prepare these statements using your own paper, but use the format shown in P-1.

Explanation / Answer

Answer:1

Answer:2

Stockholder's equity Common Retained Event Assets = Liabilities + Stock + Earnings Beg. Bal 17000 = 5000 + 10000 + 2000 a. 8000 = + + -8000 = + + b. 10000 = + + 10000 c. 6000 = + 6000 + d. -5000 = -5000 + + e. -4500 = + + -4500 f. -2000 = + + -2000 Ending balance 21500 = 0 + 16000 + 5500

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