Required information (The following information applies to the questions displayed below) The following is the adjusted trial balance of Sierra Company. The Retained Earnings account balance was $5,500 on December 31 of the prior year. Account Title Debit Credit Cash $ 5,000 Prepaid insurance 500 Notes receivable (due in 5 years) 4,000 Buildings 20,000 Accumulated depreciation-Buildings $12,000 Accounts payable 2,500 Notes payable (due in 3 years) 3,000 Common stock 5,000 Retained earnings 5,500 Dividends 1,000 Consulting revenue 9,500 Wages expense 3,500 Depreciation expense-Buildings 2.000 Insurance expense 1.500 Totals $37,500 $37,500 Required (1) Prepare an income statement for the year ended December 31 (2) Prepare a statement of retained earnings for the year ended December 31, Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required information Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for the year ended December 31. SIERRA COMPANY Income Statement Revenues: Consulting revenue $ 9.500 Total revenue ta 9,500 5 Expenses: Wages expense Depreciation expense Buildings Insurance expense 3,500 2,000 1,500 Total expense 7,000 2.500 Net income $ Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a statement of retained earnings for the year ended December 31. Owner made no investr period. SIERRA COMPANY Statement of Retained Earnings Retained earnings, December 31 prior year end Add: Net income 5,500 2,500 8,000 (1.000) Less: Dividends Retained earnings, December 31 current year end $ 7,000