Nelson Company experienced the following transactions during Year 1, its first year in operation.

1. 1. Issued $12,000 of common stock to stockholders.
   2. Provided $4,600 of services on account.
   3. Paid $3,200 cash for operating expenses.
   4. Collected $3,800 of cash from accounts receivable.
   5. Paid a $200 cash dividend to stockholders.

   The amount of retained earnings appearing on Nelson Company's December 31, Year 1 balance sheet is:

   		$1,200.
   		$1,000.
   		$1,400.
   		$13,200

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1. Nelson Company experienced the following transactions during Year 1, its first year in operation.

   1. Issued $12,000 of common stock to stockholders.
   2. Provided $4,600 of services on account.
   3. Paid $3,200 cash for operating expenses.
   4. Collected $3,800 of cash from accounts receivable.
   5. Paid a $200 cash dividend to stockholders.

   The amount of net income recognized on Nelson Company's Year 1 income statement is:

   		$1,400.
   		$800.
   		$1,000.
   		$1,200.