On June 1, 2022, Elite Service Co. was started with an initial investment in the company of $22,100 cash. Here are the assets, liabilities, and common stock of the company at June 30, 2022, and the revenues and expenses for the month of June, its first month of operations: 

During June, the company issued no additional stock but paid dividends of $1,400. 

Instructions 

a. Prepare an income statement and a retained earnings statement for the month of June and a balance sheet at June 30, 2022. 

b. Briefl y discuss whether the company’s first month of operations was a success. 

c. Discuss the company’s decision to distribute a dividend.

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Cash Accounts receivable Service revenue Notes payable Accounts payable Supplies expense Maintenance and repairs expense Utilities expense Salaries and wages expense $ 4,600 4,000 7,500 2,400 400 $12,000 500 1,000 600 Supplies Advertising expense Equipment Common stock 300 26,000 22,100 1,400