Selected accounts of Annis Consulting, Inc., a financial services business, have the following balances at December 31, 2012, the end of its first year of operations. During the year, Linda Annis, the only stockholder, bought $32,000 of stock in the business.

Requirements
1. Identify each as an asset, liability, revenue, or expense.
2. Prepare the income statement of Annis Consulting, Inc., for the year ended December 31, 2012. What is the result of operations for 2012?
3. Assuming the balance in Retained Earnings on December 31, 2012, was $7,700, what was the amount of the dividends during the year? Answer by preparing a statement of retained earnings to solve for the dividends. Recall that the business has just completed its first year and has no beginning balance for retainedearnings.

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Office Furniture Utilities Expense. Accounts Payable... 25,000 Rent Expense... 7,000 Office Supplies 120,000 Salaries Payable $30,000 3,000 700 21,500 Salaries Expense 35,000 1,000 .2,600 34,000 5,800 Cash Service Revenue Accounts Receivab.....6,500 Property Tax Expense Supplies Expense. 3,900 Equipment