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Problem 2-5A (Algo) Computing net income from equity analysis, preparing a balance sheet, and computing the debt ratio LO A2, P1

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[The following information applies to the questions displayed below.] The accounting records of Nettle Distribution show the following assets and liabilities as of December 31 for Year 1 and Year 2.

December 31	Year 1	Year 2
Cash	$ 48,814	$ 8,493
Accounts receivable	26,497	20,773
Office supplies	4,180	3,061
Office equipment	128,303	136,668
Trucks	50,206	59,206
Building	0	167,368
Land	0	41,767
Accounts payable	69,660	34,550
Note payable	0	109,135

Problem 2-5A (Algo) Part 2

2. Compute net income for Year 2 by comparing total equity amounts for these two years and using the following information: During Year 2, the owner invested $34,000 additional cash in the business in exchange for common stock, and the company paid a $42,000 cash dividend.