Answer:
1. $2,800
2. $40,000
Explanation:
1. The computation of cash dividends is paid during 2015 is shown below:-
<u> Retained earnings
</u>
<u>Dividend paid $2,800 Beginning balance $8,400</u>
($8,400 + $30,000
- $35,600) <u>Net income $30,000</u>
<u>Total $2,800 $38,400</u>
<u>Ending balance $35,600</u>
Therefore cash dividends is paid during 2015 is 2,800
2. The computation of cash amount is paid to reduce the notes payable balance in 2015 is shown below:-
<u>Notes payable</u>
<u>Cash paid $40,000 Beginning balance $69,000</u>
<u>($69,000 - $29,000)</u>
<u>Total $40,000 $69,000</u>
<u>Ending balance $29,000</u>
Therefore cash amount is paid to reduce the notes payable balance
in 2015 is $40,000