Milea Inc. experienced the following events in Year 1, its first year of operations: Received $13,500 cash from the issue of common stock. Performed services on account for $45,000. Paid the utility expense of $1,100. Collected $35,270 of the accounts receivable. Recorded $8,100 of accrued salaries at the end of the year. Paid a $1,100 cash dividend to the stockholders.

a. Prepare the income statement

b. Prepare the statement of changes in stockholders' equity

c. Prepare the balance sheet as of December 31.

d. Prepare the statement of cash flows for the Year 1 accounting period.

Income statement

For the year ended December 31, year 1

Revenue:

Service revenue 45000

Expense:

Utilities expense 1100

Salary expense 8100

Total expense 9200

Net income 35800

Statement of Changes in Stockholders' Equity

For the Year Ended December 31, Year 1

Beginning common stock: -

Common stock issued 13,500

Ending common stock 13,500

Beginning retained earnings -

Net income 35,800

Dividends (1100)

Ending retained earnings 34,700

Total stockholders' equity 48,200

Balance Sheet

As of December 31, Year 1

Assets

Cash (13500+35270-1100-1100) 46,570

Accounts receivable (45000-35270) 9730

Total assets 56,300

Liabilities

Salaries payable 8100

Total liabilities 8100

Stockholders' Equity

Common stock 13,500

Retained earnings 34,700

Total stockholders' equity 48,200

Total liabilities and stockholders' equity 56,300

Statement of Cash Flows

For the Year Ended December 31, Year 1

Cash flow from operating activities

Cash received from customers 35,270

Cash paid for utility expense (1,100)

Net cash flow from operating activities 34,170

Cash flow from investing activities -

Cash flow from financing activities

Issuance of common stock 13,500

Cash paid for dividends (1100)

Net cash flow from financing 12,500

Net change in cash 46,670

Beginning cash balance -

Ending cash balance 46,670