Sammy's Pizza opened on January 1, 2013. Sammy's reported the following for cash revenues and cash expenses

Question:

Sammy's Pizza opened on January 1, 2013. Sammy's reported the following for cash revenues and cash expenses for the years 2013 to 2015:

Cash Revenues Cash Expenses 2013 2014 2015 $20,000 $30,000 $40,000 $11,000 $14,000 $22,000

Required
a. What would Sammy's Pizza report for net income and retained earnings for the years 2013, 2014, and 2015?
b. Explain the difference between net income and retained earnings.
c. Assume that Sammy's Pizza paid a $5,000 dividend to stockholders in 2014. What would Sammy's Pizza report for net income and retained earnings for 2014 and2015?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...