19) Which of the following amounts appears on both the income statement and the balance sheet?
A) Total assets
B) Net income
C) Ending retained earnings
D) None of the above amounts appear on both
20) Which of the following financial statements shows the changes in retained earnings during a period of time?
A) Income statement
B) Statement of retained earnings
C) Statement of cash flows
D) Balance sheet
21) Which of the following financial statements lists the entity's assets, liabilities, and stockholders' equity as of a specific date?
A) Balance sheet
B) Statement of retained earnings
C) Income statement
D) Statement of cash flows
22) On the financial statements, which line item connects the balance sheet to the statement of cash flows?
A) Retained earnings (ending balance)
B) Net income
C) Total assets
D) Cash (ending balance)
23) On Jan. 1, 2012, William Kelly started Kelly's Computer Service, Inc. by incorporating the company and investing $10,000 in exchange for company stock. On Jan. 3, the company borrowed $10,000 from another investor and executed a Note payable with the principal and interest to be due in one year. On Jan 5, the company purchased $12,000 of equipment for cash. On Jan. 8, Kelly's rendered service to his first corporate client and earned $2,500 in cash. On Jan. 12, Kelly's incurred repair expense of $1,200 and promised to pay the repair contractor the following month. On Jan. 18, Kelly's rendered service to a new client in the amount of $6,000 "on account," (the client promised to pay the following month). At the end of January, Kelly's Computer Service, Inc. paid a dividend of $1,000 to William Kelly, the sole shareholder. Please prepare an income statement for the month of January, a statement of retained earnings for the month of January, and a balance sheet at Jan. 31, 2012.