Problem 1 On May 1, R. C. Twining started RC Flying School, a company that provides flying lessons, by investing $40,000 cash in the business. Following are the assets and liabilities of the company on May 31, 2017, and the revenues and expenses for the month of May. Cash $ 3,400 Accounts Receivable 4,900 Rent Expense 1,200 Equipment 64,000 Notes Payable 30,000 Accounts Payable 800 Advertising Expense $ 600 Maintenance and Repairs Expense 400 Utilities Expense 400 Gasoline Expense 2,500 Service Revenue 8,100 R. C. Twining made no additional investment in May, but he withdrew $1,500 in cash for personal use. Instructions (a) Prepare an income statement and owner's equity statement for the month of May and a balance sheet at May 31. (Hint: check Learning Objective 5). (b) Prepare an income statement and owner's equity statement for May assuming the following data are not included above: (1) $900 worth of services were performed and billed but not collected at May 31, and (2) $1,500 of gasoline expense was incurred but not paid.