Otay Lakes Park is a private camping ground near the Mount Miguel Recreation Area. It has compiled the following fi nancial information as of December 31, 2017. (LO 3)

Service revenue (from camping fees) $132,000 Dividends $ 9,000 Sales revenue (from general store) 25,000 Notes payable 50,000 Accounts payable 11,000 Expenses during 2017 126,000 Cash 8,500 Supplies 5,500 Equipment 114,000 Common stock 40,000 Retained earnings (1/1/2017) 5,000 Instructions

(a) Determine Otay Lakes Park’s net income for 2017.

(b) Prepare a retained earnings statement and a balance sheet for Otay Lakes Park as of December 31, 2017.

(c) Upon seeing this income statement, Walt Jones, the campground manager, immediately concluded, “The general store is more trouble than it is worth—let’s get rid of it.” The marketing director isn’t so sure this is a good idea. What do you think?