The balance sheet data for Bob’s Electronics, Co., November 30, 2010, follow:

Requirement 1. The following are three independent assumptions about the business during November. For each assumption, compute the amount of net income or net loss during November 2010. Find the solution by preparing the statement of retained earnings. First, use the amounts of total assets, total liabilities, and common stock given previously and the accounting equation to determine the beginning and ending retained earnings amounts. Then plug those and the other amounts given in each assumption into the statement of retained earnings to determine the net income or net loss.

a. The business paid no dividends.

b. The business paid $17,000 of dividends.

c. The business paid $25,000 of dividends.

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Total Assets Total Liabilities Common Stock......... Total Stockholders' Equity Oct 31, 2010 $140,000 75,000 Nov 30, 2010 $175,000 117,000 45,000 45,000 ? ?