Exercise 2 – 15 Requirement 1 Supplies 11/30 Balance 1,500 Expense 2,000 Purchased ? 12/31 Balance 3,000 Cost of supplies purchased = $3,000 + $2,000 – $1,500 = $3,500 Requirement 2 Prepaid insurance 11/30 Balance 6,000 Expense ? 12/31 Balance 4,500

Same if he prepares financial statements applying IFRS rules

Exercise 1 – 1 Requirement 1 Pete, Pete, and Roy Operating Cash Flow Year 1 Year 2 Cash collected $160,000 $190,000 Cash disbursements: Salaries (90,000) (100,000) Utilities (30,000) (40,000) Purchase of insurance policy (60,000) - 0 - Net operating