Hernandez Company Began Business Operations and Experienced the Following Transactions
Hernandez Company began business operations and experienced the following transactions during 2016:
1)Issued common stock for $50,000 cash.
2)Provided services to customers for $125,000 on account.
3)Purchased $2,500 of supplies on account.
4)Paid $30,000 cash to rent office space for a 12-month period beginning July 1.
5)Collected $115,000 cash from customers.
6)Paid cash for $90,000 of operating expenses.
7)Adjusted the accounting records to reflect that there was $750 of supplies remaining on hand at year-end.
8)Recorded an end-of-year adjustment to recognize rent expense.
a)Record the above transactions on a horizontal statements model,reflecting their effect on the different financial statements.Precede the amount with a minus sign if the transaction reduces that section of the equation.Precede a cash outflow amount with a minus sign.Enter 0 for items not affected.
b)Prepare Hernandez Company's income statement,balance sheet and statement of cash flows for the year ended December 31,2016.