Questions
BACC011 Week 5: Practice Quiz
Short answer
Here is some information for a business. Calculate the retained earnings closing balance. Sales revenue 154,195 Other revenue 9,300 Unearned revenue 19,906 Cost of sales 57,754 Other business expenses 19,794 Income tax expense 4,857 Prepaid expenses 11,055 Share capital 102,676 Retained earnings, opening balance 146,442 Dividends 5,000
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Step-by-Step Analysis
To determine the retained earnings closing balance, start with the opening retained earnings and adjust for net income and dividends during the period.
First, compute total revenues: Sales revenue 154,195 plus ......Login to view full explanationLog in for full answers
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Problem 18-4 (Algo) Statement of retained earnings; financial statement effects [LO18-5, 18-7] Comparative statements of retained earnings for Renn-Dever Corporation were as follows: RENN-DEVER CORPORATION Statements of Retained Earnings For the Years Ended December 31 2026 2025 2024 Balance at beginning of year $6,737,452 $5,494,552 $5,644,552 Net income (loss) 3,208,700 2,100,900 (150,000) Deductions: Stock dividend (30,000 shares) 210,000 Common shares retired (100,000 shares) 200,000 Common stock cash dividends 809,950 658,000 0 Balance at end of year $8,926,202 $6,737,452 $5,494,552 At December 31, 2023, common shares consisted of the following: Common stock, 1,700,000 shares at $1 par $ 1,700,000 Paid-in capital—excess of par 5,100,000 Required: Infer from the reports the events and transactions that affected Renn-Dever Corporation’s retained earnings during 2024, 2025, and 2026. Prepare the journal entries that reflect those events and transactions. (Hint: In lieu of revenues and expenses, use an account titled "Income summary" to close net income or net loss.) Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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