The following transactions apply to Norris Co. for 2013, its first year of operations:
1. Issued $70,000 of common stock for cash.
2. Provided $95,000 of services on account.
3. Collected $81,000 cash from accounts receivable.
4. Loaned $20,000 to Scott Co. on November 30, 2013. The note had a one-year term to maturity and a 6 percent interest rate.
5. Paid $24,000 of salaries expense for the year.
6. Paid a $2,000 dividend to the stockholders.
7. Recorded the accrued interest on December 31, 2013 (see item 4).
8. Determined that $620 of accounts receivable were uncollectible.
Required:
a. Record the above transactions in general journal form.
b. Post the entries to T-accounts.
c. Prepare the income statement, balance sheet, and statement of cash flows for 2013.
d. Show the effects of the above transactions in a horizontal statements model like the one shown below:
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