Exercise B

Assume that retained earnings increased by USD 3,600 from 2010 June 30, to 2011 June 30. A cash dividend of USD 300 was declared and paid during the year.

a. Compute the net income for the year.

b. Assume expenses for the year were USD 9,000. Compute the revenue for the year.

Exercise E

For each of the following events, determine if it has an effect on the specific items (such as cash) in the accounting equation. For the events that do have an effect, present an analysis of the transaction showing its two sides or dual nature.

a. Purchased equipment for cash, USD 12,000.

b. Purchased a truck for USD 40,000, signed a note (with no interest) promising payment in 10 days.

c. Paid USD 1,600 for the current months utilities. d. Paid for the truck purchased in (b).

e. Employed Mary Childers as a salesperson at USD 1,200 per month. She is to start work next week.