On December $1,$ Year $1,$ John and Patty Driver formed a corporation called Susquehanna Equipment Rentals. The new corporation was able to begin operations immediately by purchasing the assets and taking over the location of Rent$-$It$,$ an equipment rental company that was going out of business. The newly formed company uses the following accounts. Dec. $1$ Issued to John and Patty Driver $29,000$ shares of capital stock in exchange for a total of $$290,000$ cash.

Dec. $1$ Purchased for $$220,800$ all of the equipment formerly owned by Rent$-$It$.$ Paid $$134,000$ cash and issued a $1-$year note payable for $$86,800.$ The note, plus all $12$ months of accrued interest, are due November $30,$ Year $2.$

Dec. $1$ Paid $$10,800$ to Shapiro Realty as three months$$ advance rent on the rental yard and office formerly occupied by Rent$-$It$.$

Dec. $4$ Purchased office supplies on account from Modern Office Co$.,$ $$1,000.$ Payment due in $30$ days. $($These supplies are expected to last for several months; debit the Office Supplies asset account.$)$

Dec. $8$ Received $$8,200$ cash as advance payment on equipment rental from McNamer Construction Company. $($Credit Unearned Rental Fees.$)$

Dec. $12$ Paid salaries for the first two weeks in December, $$4,700.$

Dec. $15$ Excluding the McNamer advance, equipment rental fees earned during the first $15$ days of December amounted to $$18,700,$ of which $$12,800$ was received in cash.

Dec. $17$ Purchased on account from Earth Movers, Inc., $$600$ in parts needed to repair a rental tractor. $($Debit an expense account.$)$ Payment is due in $10$ days.

Dec. $23$ Collected $$2,200$ of the accounts receivable recorded on December $15.$

Dec. $26$ Rented a backhoe to Mission Landscaping at a price of $$320$ per day, to be paid when the backhoe is returned. Mission Landscaping expects to keep the backhoe for about two or three weeks.

Dec. $26$ Paid biweekly salaries, $$4,700.$

Dec. $27$ Paid the account payable to Earth Movers, Inc., $$600.$

Dec. $28$ Declared a dividend of $10$ cents per share, payable on January $15,$ Year $2.$

Dec. $29$ Susquehanna Equipment Rentals was named, along with Mission Landscaping and Collier Construction, as a co$-$defendant in a $$21,000$ lawsuit filed on behalf of Kevin Davenport. Mission Landscaping had left the rented backhoe in a fenced construction site owned by Collier Construction. After working hours on December $26,$ Davenport had climbed the fence to play on parked construction equipment. While playing on the backhoe, he fell and broke his arm. The extent of the company$$s legal and financial responsibility for this accident, if any, cannot be determined at this time. $($Note: This event does not require a journal entry at this time, but may require disclosure in notes accompanying the statements.$)$

Dec. $29$ Purchased a $12-$month public liability insurance policy for $$9,360.$ This policy protects the company against liability for injuries and property damage caused by its equipment. However, the policy goes into effect on January $1,$ Year $2,$ and affords no coverage for the injuries sustained by Kevin Davenport on December $26.$

Dec. $31$ Received a bill from Universal Utilities for the month of December, $$650.$ Payment is due in $30$ days.

Dec. $31$ Equipment rental fees earned during the second half of December amounted to $$20,100,$ of which $$16,500$ was received in cash.

Data for Adjusting Entries

The advance payment of rent on December $1$ covered a period of three months.

The annual interest rate on the note payable to Rent$-$It is $6$ percent.

The rental equipment is being depreciated by the straight$-$line method over a period of eight years.

Office supplies on hand at December $31$ are estimated at $$670.$

During December, the company earned $$4,500$ of the rental fees paid in advance by McNamer Construction Company on December $8.$

As of December $31,$ six days$$ rent on the backhoe rented to Mission Landscaping on December $26$ has been earned.

Salaries earned by employees since the last payroll date $($December $26)$ amounted to $$1,900$ at month$-$end.

It is estimated that the company is subject to a combined federal and state income tax rate of $30$ percent of income before income taxes $($total revenue minus all expenses other than income taxes$).$ These taxes will be payable in Year $2.$ Prepare a statement of retained earnings for the year ended December $31.($Round your final answers to the nearest whole dollar.$)$ The first box to be solved is Retained Earnings, December $1,$ Year $1$: The $2$nd box to be solved is Add: Net Income The $3$rd box to be solved is Less: dividends Lastly, the $4$th box to be solved is Retained Earnings, December $31,$ Year $1$