Chapter 1, Problem 1.21EX

Balance sheets, net income

Financial information related to Ebony Interiors for February and March 2018 is as follows:

	February 28, 2018	March 31, 2018
Cash	320,000	380,000
Accounts receivable	800,000	960,000
Supplies	30,000	35,000
Accounts payable	310,000	400,000
Common stock	200,000	200,000
Retained earnings	?	?

1. A. Prepare balance sheets for Ebony Interiors as of February 28 and March 31, 2018.
2. B. Determine the amount of net income for March, assuming that no additional common stock was issued and no dividends were paid during the month.
3. C. Determine the amount of net income for March, assuming that no additional common stock was issued, but dividends of $50,000 were paid during the month.