Betsy Company's December 31, Year 1, balance sheet showed $1,900 cash, $500 accounts payable, $400 common stock and $1,000 retained earnings. The company experienced the following events during Year 2.(1)On April 1, Year 2 the company paid $2,400 cash to rent office space for the coming year starting immediately(2)Earned $3,600 cash revenue(3)Paid a $200 cash dividendBased on this information, the company would report

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The company earned $3,600 cash revenue and paid $2,400 cash for rent, resulting in a $1,200 net cash inflow from operating activities. The company paid a $200 cash dividend, reducing retained earnings to $1,000 - $200 = $800. The $2,400 rent payment creates a $600 prepaid rent asset on the balance sheet.

Betsy Company's December 31, Year 1, Balance Sheet Showed $1,900