Can you please answer this small assignment from my advanced accounting course.

Considering how much they worked, the Holts were concemed that the cash balanse decreased by $25,500 even though they only received dividends of $40,000. Their combined income from the auto manufacturer had been $65,000. They were seriously considering giving up their business and going back to work for the auto manufacturer. They turned to you for advice. You discovered the following: in2002, $24,000 were used on jobs billed to customers in 2002; no supplies were used for any other work. 1. Of the supplies purchased 2. Work completed in2002 and billed to customers for which cash had not yet been received by year-end amounted to $40,000. Your first step in the analysis is to rough out an income statement for the Holts in2002. Case 2 Heather and Dan Holt met while both were employed in the interior trim and upholstery department of an auto manufacturer. After their marriage, they decided to eam some extra income by doing small jobs involving canvas, vinyl, and upholstered products. Their work was considered excellent, and at the urging of their customers, they decided to go into business for themselves, operating out of the basement of the house they owned. To do this, they invested $120,000 cash in their business. They spent $10,500 for a sewing machine (expected life 10 years) and $12,000 for other miscelianeous tools and equipment (expected life 5 years). They undertook only custom work, with the customers purchasing the required materials, to avoid stocking any inventory other than supplies. Generally, they required an advance deposit on all jobs. The business seemed successful from the start, as the Holts received orders from many customers. But they felt something was wrong. They worked hard and charged competitive prices. Yet there seemed to be barely enough cash available from the business to cover immediate personal needs. Summarized, the checkbook of the business far 20A2, their second year of operations, showed: Balance, January 1,2002 from customers: for work done in 2001 for work done in 2002 for wsrk to be done in 2003 $99,200 cash received $36,000 200,000 48,000 284,000 383,200 Cash paid out: Two year insurance policY, dated r/1/02 utilities supplies other expenses taxes, including sales taxes dividends balance, 12/31102 $19,200 48,000 104,000 72,A00 26,4A0 40,000 309,600 $73,600