Sandhill Co., a ski tuning and repair shop, opened on November 1, 2016. The company carefully kept track of all its cash receipts and cash payments. The following information is available at the end of the ski season, April 30, 2017.

Cash
Receipts Cash
Payments
Issuance of common shares $20,000
Payment to purchase repair shop equipment $9,200
Payments to landlord 1,225
Newspaper advertising payment 375
Utility bill payments 970
Part-time helper’s wage payments 2,600
Income tax payment 10,000
Cash receipts from ski and snowboard repair services 32,150
Subtotals 52,150 24,370
Cash balance 27,780
Totals
$52,150

$52,150

The repair shop equipment was purchased on November 1 and has an estimated useful life of 4 years. Lease payments to the landlord are made at the beginning of each month. The payments to the landlord included a security deposit of $175. The part-time helper is owed $420 at April 30, 2017, for unpaid wages. At April 30, 2017, customers owe Franken Company $540 for services they have received but have not yet paid for.

-Prepare an accrual-basis income statement for the 6 months ended April 30, 2017.

-Prepare the April 30, 2017, classified balance sheet.

P8-4b dropping unfavorable division based on the following analysis of last year's operations of groves, inc., a financial vice president of the company believes that the firm's total net income could be increased by $160,000 if its design division were discontinued. (amounts are given in the thousands of dollars.) required provide answers for each of the following independent situations: a. assuming that total fixed costs and expenses would not be affected by discontinuing the design division, prepare an analysis showing why you agree or disagree with the vice president. b. assume that the discontinuance of the design division will enable the company to avoid 30% of the fixed portion of cost of services and 40% of the fixed operating expenses allocated to the design division. calculate the resulting effect on net income. c. assume that in addition to the cost avoidance in requirement (b), the capacity released by discontinuance of the design division can be used to provide 6,000 new services that would have a variable cost per service of $60 and would require additional fixed costs totaling $68,000. at what unit price must the new service be sold if groves is to increase its total net income by $180,000?