Reference no: EM131427259
The December 31, 2012, balance sheet of Smedley Company is as follows:
During 2013 the company entered into the following transactions:
1. Common stock was issued for $35,000 cash.
2. Services were performed for $50,000 cash.
3. Cash expenses of $24,000 were incurred.
4. Long-term liabilities of $15,000 were paid.
5. Dividends of $7,000 were declared and paid.
a. Classify each transaction as operating, investing, or financing and then prepare an income statement.
b. Compute comprehensive income, and compare it to the income amount calculated in (a).
c. Explain why the two dollar amounts are equal.
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