A summary of the operations of Streuling Company for the year ended May 31, 2000, is shown below. Advertising expense....... $ 2,760 Supplies expense 37,820 Rent expense. 1,500 Salaries expense 18,150 Miscellaneous expense. 4,170 Dividends.. 12,400 Retained earnings (6/1/99). 156,540 Income taxes..... 21,180 Consulting fees (revenues). 115,100 7,250 Administrative expense ...... 1. Determine the net income for the year by preparing an income statement. (Assume that 3,000 shares of stock are outstanding.) 2. Compute the return on equity (ROE) for Streuling Company, assuming total own- ers' equity is $255,000. 3. Interpretive Question: What does the ROE ratio explain about Streuling's prof- itability? 4. Interpretive Question: Assuming an operating loss for the year, is it a good idea for Streuling to still pay its shareholders dividends?