Answer:
a) 
     assets                            =            liabilities              +         equity
     cash                                      deferred revenue             retained earnings
1)   $40,800                               $40,800
<u>2)   $0                                         -$,6800                              $6,800                 </u>
     $40,800                               $34,000                              $6,800
      revenues           -          expenses     =         net income         cash flows
1)       $0                                  $0                            $0                   $40,800 OA
<u>2)   $6,800                             $0                        $6,800                   $0       OA</u>
      $6,800                             $0                        $6,800                $40,800 NC
b) Yard Designs
Income Statement 
For the year ended December 31, 2018
Revenues           $6,800
<u>Expenses               $0     </u>
Net income        $,6800
Yard Designs
Balance Sheet
For the year ended December 31, 2018
Assets:
Cash $40,800
Total assets                                 $40,800
Liabilities:
Deferred revenue $34,000
Equity:
Retained earnings $6,800
Total liabilities and equity             $40,800
Yard Designs
Statement of Cash Flows
For the year ended December 31, 2018
Cash flows from operating activities:
Net income                                         $6,800
Adjustments to net income:
- Increase in deferred revenue <u>$34,000</u>
Net cash flow from operating act.   $40,800
Cash flows from investing activities:       $0
Cash flows from financing activities:       $0
Net increase in cash                         $40,800
Initial cash balance                           <u>          $0</u>
Ending cash balance                        $40,800
c) $34,000