Mark’s Consulting experienced the following transactions for 2016, its first year of operations, and 2017.

Mark’s Consulting experienced the following transactions for 2016, its first year of operations, and 2017. Assume that all transactions involve the receipt or payment of cash.

Transactions for 2016

1.	Acquired $55,000 by issuing common stock.
2.	Received $105,000 for providing services to customers.
3.	Borrowed $16,000 cash from creditors.
4.	Paid expenses amounting to $59,000.
5.	Purchased land for $35,000 cash.

Transactions for 2017

Beginning account balances for 2017 are:

Cash	$	82,000
Land		35,000
Notes payable		16,000
Common stock		55,000
Retained earnings		46,000

1.	Acquired an additional $21,000 from the issue of common stock.
2.	Received $131,000 for providing services in 2017.
3.	Paid $11,000 to reduce notes payable.
4.	Paid expenses amounting to $74,000.
5.	Paid a $14,500 dividend to the stockholders.
6.	Determined that the market value of the land is $45,000.

Required

a.

Record the effects of each accounting event under the appropriate headings for each year. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide appropriate titles for these accounts in the last column of the table.   b-1. Prepare an income statement for each year accounting period. b-2. Prepare a statement of changes in stockholders’ equity for each year accounting period.   b-3. Prepare a year-end balance sheet for each year accounting period.   b-4. Prepare a statement of cash flows for each year accounting period.   c. Determine the amount of cash that is in the retained earnings account at the end of 2016 and 2017.   e. Determine the balance in the Retained Earnings account immediately after Event 2 in 2016 and in 2017 are recorded. Explanation: e. Immediately after Event 2 in 2016 is recorded the balance in the retained earnings account is zero. The revenue is recorded in a revenue account, not in the retained earnings account. The revenue, expense, and dividend accounts are closed to the retained earnings account at the end of each accounting period. After closing the accounts at the end of 2016 the retained earnings account will have a balance of $46,000 ($105,000 revenue – $59,000 expenses). The 2016 ending balance in retained earnings becomes next year’s beginning balance. Thus, the balance in the retained earnings account on January 1, 2017 is $46,000. This balance will not change until the closing process is completed in December 2017. As a result, the balance in the retained earnings account immediately after Event 2 in 2017 is $46,000.