both questions 2 and 3

2. Which of the following best describes the interconnectedness of the income statement to the balance sheet? A. Net income is reinvested in the business in the form of dividends that increase owner's equity B. Net income is reinvested in the business in the form of retained earnings that increase owner's equity C. Net income is reinvested in the business (minus any dividends paid to owners), which increases owner's equity D. Net income is reinvested in the business (plus any dividends paid to owners), which increases owner's equity E. Net income or loss has no impact on owner's equity 3. Which of the following best describes how to record the following transaction: June 30th : Paid rent expense of $5,000 in cash for the month of June. A. Debit Prepaid Rent \& Credit Cash since the expense has been incurred during the month of June. B. Debit Prepaid Rent \& Credit Cash since the prepayment represents an asset to the company. C. Debit Rent Expense \& Credit Cash since the prepayment represents an asset to the company. D. Debit Rent Expense \& Credit Cash since the expense has been incurred during the month of June. E. Debit Rent Expense \& Credit Prepaid Rent to reduce the prepaid asset balance for the expense incurred in June