Bensen Company started business by acquiring $27,200 cash from the issue of common stock on January 1, Year 1. The cash acquired was immediately used to purchase equipment for $27,200 that had a $3,200 salvage value and an expected useful life of four years. The equipment was used to produce the following revenue stream (assume that all revenue transactions are for cash). At the beginning of the fifth year, the equipment was sold for $3,790 cash. Bensen uses straight-line depreciation. Year 1 Revenue $ 7,870 Year 2 $ 8,370 Year 3 $ 8,570 Year 4 $ 7,370 Year 5 $ 0 Required Prepare income statements, statements of changes in stockholders' equity, balance sheets, and statements of cash flows for each of the five years.

Bensen Company started business by acquiring $27,200 cash from the issue of common stock on January 1, Year 1. The cash acquired was immediately used to purchase equipment for $27,200 that had a $3,200 salvage value and an expected useful life of four years. The equipment was used to produce the following revenue stream (assume that all revenue transactions are for cash). At the beginning of the fifth year, the equipment was sold for $3,790 cash. Bensen uses straight-line depreciation. Year 1 Revenue $ 7,870 Year 2 $ 8,370 Year 3 $ 8,570 Year 4 $ 7,370 Year 5 $ 0 Required Prepare income statements, statements of changes in stockholders' equity, balance sheets, and statements of cash flows for each of the five years.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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