Figgaro Company Inc A Calculate Net Income

question 50

Essay

Figgaro Company Inc.'s accounts and their balances, as of the end of August, are included below. All accounts have normal balances: $\begin{array}{c}\begin{array}{lc}\text { Accounts receiv able..... } & \$ 36,000 \\& \\\text { Equipment............ } & 59,000 \\\text { Service revenues earned. } & 75,000 \\\text { Rent exp ense ........... } & 3,600 \\\text { Office supplies......... } & 1,500 \\\text { Notes payable......... } & 22,000 \end{array}\begin{array}{cr} \text { Cash ................. } & \$ 28,000 \\\text { Common stock } & 1,000 \\\text { Advertising expense ...... } & 5,000 \\\text { Accounts payable........ } & 31,000 \\\text { Dividends.. } & 24,000 \\\text { Salaries expense......... } & 30,000 \\\text { Retained earnings....... } & 58,100 \end{array}\end{array}$
a. Calculate net income.
b. Determine the amount of retained earnings to be shown on the August 31 balance sheet.

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