Balance Sheet and Income Statement of the Performance Corporation are given as of the end of 2100. If the company wants to have its operations so as to have the same Income Statement and Cash Account at the end of 2101 and does not want to distribute any dividends, what are the options open to Performance. You do not need to reproduce the financial statements. It is enough to enumerate the options available to the company

 

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Revenues: Sales Services Total revenues Expenses: Cost of goods sold Selling expenses Depreciation expense Salaries and wages Assets Cash PERFORMANCE CORPORATION Income Statement For the Year Ended December 31, 2100 Total expenses (excluding income tax) Pretax income Income tax expense (25% x $43,000) Net income Liabilities Accounts payable (to suppliers) Note payable (to bank) Total liabilities Stockholders' equity Common stock, 6,500 shares Retained earnings Total stockholders' equity Accounts receivable (from customers) Merchandise inventory (for resale) Supplies inventory (for use in rendering services) Service vehicles Less accumulated depreciation Total assets $180,000 52.000 62,000 Total liabilities and stockholders' equity $ 90,000 25,000 12,000 $232,000 $65,000 PERFORMANCE CORPORATION Balance Sheet At December 31, 2100 189,000 10.750 $32.250 43,000 32,250 $50,000 (12,000) $ 32,000 13,000 42,000 15,000 38.000 $140.000 $17,750 25,000 42,750 97,250 $140.000 Revenues: Sales Services Total revenues Expenses: Cost of goods sold Selling expenses Depreciation expense Salaries and wages Assets Cash PERFORMANCE CORPORATION Income Statement For the Year Ended December 31, 2100 Total expenses (excluding income tax) Pretax income Income tax expense (25% x $43,000) Net income Liabilities Accounts payable (to suppliers) Note payable (to bank) Total liabilities Stockholders' equity Common stock, 6,500 shares Retained earnings Total stockholders' equity Accounts receivable (from customers) Merchandise inventory (for resale) Supplies inventory (for use in rendering services) Service vehicles Less accumulated depreciation Total assets $180,000 52.000 62,000 Total liabilities and stockholders' equity $ 90,000 25,000 12,000 $232,000 $65,000 PERFORMANCE CORPORATION Balance Sheet At December 31, 2100 189,000 10.750 $32.250 43,000 32,250 $50,000 (12,000) $ 32,000 13,000 42,000 15,000 38.000 $140.000 $17,750 25,000 42,750 97,250 $140.000

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