1- Prepare an income statement for the year ended December 31, 2020. (10 marks)

2- Prepare a statement of retained earnings for year ended December 31, 2020. (10 marks)

3- Calculate the current ratio. What does it measure? (5 mark)

Problem 2 (25 marks) Below is the adjusted trial balance for Destiny Inc. below as of December 31, 2020. Destiny Inc. Adjusted Trial Balance December 31, 20120 Debit Credit Cash $62,500 Accounts receivable 40,200 Supplies 550 Prepaid insurance 820 Equipment 36,000 Accumulated depreciation-equipment $8,800 Accounts payable 6,500 Unearned service revenue 15,700 Salary payable 42,650 Common shares 23,295 Retained earnings 10,000 Dividends 8,000 Service revenue 82,200 Salary expense 32,850 Supplies expense 3,200 Insurance expense 800 Depreciation expense-equipment 925 3,300 $189.145 $189.145 Utilities expense