Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business earned during the past year in order to decide whether to keep the company going. His accounting records consit of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. Cash Accounts Payable Stasney, Capital Salaries Expense Dec. 31 5,800 21,500 Dec. 31 20,000 Dec. 31 Dec. 31 17,000 Accounts Receivable Unearned Revenue Stasney, Withdrawals Expense-Equipment Dec. 31 12,000 4,000 Dec. 31 Dec. 31 28,000 Prepaid Rent Salaries Payable Service Revenue Rent Expense Jan. 2 2,800 59,500 Dec. 31 Office Supplies Utilities Expense Dec. 31 800 Jan. 2 2,600 Equipment Supplies Expense Jan. 2 36,000 Accumulated Depreciation-Equipment Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, Swift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads