The following accounts and account balances are taken from the records of Rudolf Corporation, at December 31, 2022.

	2022	2021
Accounts payable	5,000	6,000
Accounts receivable	15,000	17,000
Notes receivable	12,000	18,000
Bank loan	8,000	12,000
Building	65,000	50,000
Cash	9,000	12,000
Dividends	8,000	3,000
Equipment	15,000	8,000
Income taxes payable	3,500	4,500
Land	20,000	20,000
Merchandize inventory	10,000	8,000

Mortgage payable	110,000	120,000
Prepaid insurance	5,500	5,800
Share capital	20,000	15,000
Retained earnings, start of year	?	5,500
Net income	?	?

Other information:

1. $5,000 of the notes receivable on December 31, 2022, will be received in 2023. No new notes receivable were issued in 2022.
2. $6,000 of the bank loan and $10,000 of the mortgage payable must be repaid by December 31, 2023. There were no additions the mortgage in 2022 but an additional $3,000 was added to the bank loan, in 2022.

Required:

1. Calculate net income for 2021 and 2022 using the T account method demonstrated in the lecture.

2. Prepare a classified statement of financial position (Comparative statement 2022 and 2021). Assume all accounts have normal balances. Disclose all amounts separately on the statement of financial position. In other words, do not use notes in requirement 2.
3. Does the company have sufficient resources to meet its current obligations in 2023?

Refer to BDCCs note 4 shown in this chapter. Prepare a note to the financial statements for PPE. Assume there was a $10,000 addition to building in 2021, and that there is no depreciation calculated for either year