Reference no: EM131761731

Question 1 - Given the following information, prepare an income statement for year ended December 31.

($000)

Stockholder's equity 500

Accounts payable 150

Cost of goods sold 55

Accumulated depreciation 500

General & administrative expenses 12

Taxes 40%

Preferred stock dividends 5

Interest expense 5

Sales revenue 100

Depreciation expense 10

Question 2 - Ajax Inc. had profits of $200,000 for the year. Their retained earnings account grew from $800,000 at the beginning of the year to $950,000 by year end. How much did the firm pay out in dividends?