Question:Describe all of the effects for the current fiscal yearThree months after the beginning of the year, the firm purchased a building for $600 incash. The building is going to be the new corporate headquarters. The building has anestimated useful life of 10 years, and a salvage value of zero. The firm uses the straight-linemethod for depreciation.balance sheet: PP&E 555 depreciation expense 45 accumulated depreciation 45ÿincome statement:retained earnings portion of the statement of shareholders’ equity: NI down 555CF statement: CF investing activities down 600 CF operating activities depreciation up 45Five months after the beginning of the year, the firm, which is an insurance company,collected $120 from its customers for one year worth of insurance premiums. Coverage iseffective immediately.balance sheet: cash up 120ÿincome statement: revenue up 120ÿretained earnings portion of the statement of shareholders’ equity: NI up 120ÿCF statement: operating CF up 120

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