Hart Attorney at Law experienced the follwoing transactions in 2016, the first year of operations:
1. Accepted $36,000 on 4/1/16, as a retainer for services to be performed evenly over the next 12 months (2) Performed legal services for cash of $54,000 (3) Purchased $2,800 of office suppies on account (4) Paid $2,400 of the amount due on accounts payable (5) Paid a cahs dividend to the stockholders of $5,000 (6) Paid cash for operationg expenses of $31,000 (7) Determined that at the end of the accounting period $200 of office supplies remained on hand (8) On 12/31/16, recognized the revenue that had been earned for services performed in accordance with Transaction 1
Problem: Show the effects of the events on the fianncial statements using a horizontal statement model. In the cash flow column, use the initials OA to designate 'operating activity'; IA for 'investing activity'; FA for 'financial activity'; and NC for 'net change in cash'. Use NA to indicate accounts not affected by the event.