Retained Earnings Statement Financial information related to Healthy Products Co

Question

Retained Earnings Statement Financial information related to Healthy Products Company for the month ended November 30, 2018, is as follows: Net income for November Cash dividends paid during November Retained earnings, November 1, 2018 a. Prepare a retained earnings statement for the month ended November 30, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. $81,190 8,930 619,500 Healthy Products Company Retained Earnings Statement For the Month Ended November 30, 2018 b. Why is the retained earnings statement prepared before the November 30, 2018, balance sheet? 1. To arrive at the number of shares outstanding. 2. To calculate the net income for the year. 3. To calculate the ending retained earnings balance to be included on the balance sheet. 4. To calculate the total assets.

Explanation / Answer

a) Healthy Products Company Retained earnings ,November 1,2018 619,500 add:Net income 81,190 less:dividends paid -8,930 72,260 Retained earnings,November 30,2018 547,240 b) answer)option 3 to calculate the ending retained earnings balance to be included on the balance sheet.

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