Financial Statements and closing Entries The Gorman Group is a financial planning services firm owned and operated by Nicole Gorman. As of October 31, 2018, the end of the fiscal year, the accountant for The Gorman Group prepared an end-of- period spreadsheet, part of which follows: The Gorman Group End-of-Period Spreadsheet For the Year Ended October 31, 2018 Adjusted Trial Balance Account Title Dr. Cr. Cash $15,820 Accounts Receivable 34,430 Supplies 5,380 Prepaid Insurance 11,620 Land 122,000 Buildings 440,000 Accumulated Depreciation-Buildings 143,300 Equipment 318,000 Accumulated Depreciation-Equipment 186,700 Accounts Payable 40,730 Salaries Payable 4,040 Unearned Rent 1,830 Common Stock 183,000 Retained Earnings 339,360 Dividends 30,600 Service Fees 580,770 Rent Revenue 6,130 Salaries Expense 416,360 Depreciation Expense-Equipment 22,600 Rent Expense 18,900 Supplies Expense 13,400 Utilities Expense 12,110 Depreciation Expense-Buildings 8,070 Repairs Expense 6,670 Insurance Expense 3,660 Miscellaneous Expense 6,240 1,485,860 1,485,860 1. Prepare an income statement. The Gorman Group Income Statement For the Year Ended October 31, 2018 Revenues: Service fees $ 580,770 6,130 Rent revenue Total Revenues $ 586,900 Expenses: Salaries expense Depreciation expense-equipment Rent expense Supplies expense Utilities expense $ 416,360 22,600 18,900 13,400 12,110 8,070 6,670 3,660 6,240 Depreciation expense-buildings Repairs expense Insurance expense Miscellaneous expense Total Expenses 508,010 78,890 Net income The Gorman Group Retained Earnings Statement For the Year Ended October 31, 2018 Retained earnings, November 1, 2017 Net income $ 78,890 Dividends Change in retained earnings 586,900 x Retained earnings, October 31, 2018 Prepare a balance sheet. The Gorman Group Balance Sheet October 31, 2018 Assets Current assets: Cash $ Liabilities Current liabilities: Accounts payable Salaries payable Unearned rent s 15,820 34,430 5,380 11,620 Accounts receivable 40,730 4,040 1,830 Supplies Prepaid insurance Total liabilities $ 46,600 $ 67,250 Total current assets Property, plant, and equipment: Land $ 122,000 Stockholders' Equity Common stock V Retained earnings V 183,000 339,360 X Buildings Accumulated depreciation-buildings Book value-buildings $ 440,000 143,300 Equipment S 318,000 186,700 Accumulated depreciation-equipment V Book value-equipment 318,000 x Total property, plant, and equipment Total assets Total stockholders' equity Total liabilities and stockholders' equity 2. Journalize the entries that were required to close the accounts at October 31. For a compound transaction, if a box does not require an entry, leave it blank. Date Account Debit Credit 2018 Oct. 31 Close Service Fees 580,770 revenues Rent Revenue 6,130 Income Summary 0 586,900 Oct. 31 Close expenses Income Summary 586,900 x Salaries Expense Depreciation Expense-Equipment Rent Expense Supplies Expense Utilities Expense 416,360 22,600 18,900 13,400 12,110 8,070 6,670 3,660 6,240 Depreciation Expense-Buildings Repairs Expense Insurance Expense Miscellaneous Expense Oct. 31 Close income/loss Income Summary Retained Earnings Oct. 31 Close dividends Retained Earnings Dividends 3. If Retained Earnings had instead decreased $42,800 after the closing entries were posted, and the dividends remained the same, what would have been the amount of net income or net loss? Enter all amounts as positive numbers. Net Loss $