Help! I have tried and tried and can\'t figure this one out! Use the data from t
ID: 2399037 • Letter: H
Question
Help! I have tried and tried and can't figure this one out!
Use the data from the following financial statements.
The company paid interest expense of $18,300 for 2014 and had an overall tax rate of 40% for 2014. Complete the statement of retained earnings for? 2014, and determine the dividends paid last year.
1) The distributed earnings is ?$ _________ <<< How on earth do I figure this out.
Partial Income Statment Year Ending 2014 Sales Revenue $349,800 Cost of good sold $141,900 Fixed Cost $43,200 Selling, general, and administrative expense $28100 Depreciation $46, 200Explanation / Answer
Answers
Working
ASSETS
31 December 2013
31 December 2014
Cash
$ 16,100.00
$ 26,000.00
Accounts Receivable
$ 28,200.00
$ 18,900.00
Inventories
$ 48,100.00
$ 53,100.00
Fixed Assets
$ 367,900.00
$ 446,800.00
Accumulated Depreciation
$ (140,700.00)
$ (186,900.00) [140,700 last year’s + 46,200 depreciation expense of 2014]
Intangible Assets
$ 81,900.00
$ 82,200.00
A
TOTAL ASSETS
$ 401,500.00
$ 440,100.00
Liabilities
Notes Payable
$ 14,200.00
$ 11,900.00
Accounts Payable
$ 18,900.00
$ 24,000.00
Long Term Debt
$ 190,200.00
$ 161,800.00
B
TOTAL LIABILITIES
$ 223,300.00
$ 197,700.00
C
Common Stock
$ 132,000.00
$ 182,000.00
D=A - B - C
Retained Earnings Balance
$ 46,200.00 [Beginning balance for 2014]
$ 60,400.00 [Ending balance for 2014]
A
Sales Revenue
$ 349,800.00
B
Cost of Goods Sold
$ 141,900.00
C=A-B
Gross Profits
$ 207,900.00
1
Fixed Cost
$ 43,200.00
2
Selling General Administrative expense
$ 28,100.00
3
Depreciation
$ 46,200.00
D = C - (1+2+3)
Operating Income
$ 90,400.00
E
Interest Expense
$ 18,300.00
F = D - E
Net Income before income taxes
$ 72,100.00
G = F x 40%
Income Taxes
$ 28,840.00
H = F - G
Net Income
$ 43,260.00
= $ 43,260 – $ 14,200
= $ 29,060 = Answer = Distributed Earnings
A [See Step 1 for 2013]
Retained earnings 12/31/2013
$ 46,200.00
B [See Step 2]
Net Income for 2014
$ 43,260.00
C=A+B
Total
$ 89,460.00
D [See Step 1 for 2014]
Retained Earnings as calculated for 12/31/2014
$ 60,400.00
E = C - D
Distributed Earnings
$ 29,060.00
Working
ASSETS
31 December 2013
31 December 2014
Cash
$ 16,100.00
$ 26,000.00
Accounts Receivable
$ 28,200.00
$ 18,900.00
Inventories
$ 48,100.00
$ 53,100.00
Fixed Assets
$ 367,900.00
$ 446,800.00
Accumulated Depreciation
$ (140,700.00)
$ (186,900.00) [140,700 last year’s + 46,200 depreciation expense of 2014]
Intangible Assets
$ 81,900.00
$ 82,200.00
A
TOTAL ASSETS
$ 401,500.00
$ 440,100.00
Liabilities
Notes Payable
$ 14,200.00
$ 11,900.00
Accounts Payable
$ 18,900.00
$ 24,000.00
Long Term Debt
$ 190,200.00
$ 161,800.00
B
TOTAL LIABILITIES
$ 223,300.00
$ 197,700.00
C
Common Stock
$ 132,000.00
$ 182,000.00
D=A - B - C
Retained Earnings Balance
$ 46,200.00 [Beginning balance for 2014]
$ 60,400.00 [Ending balance for 2014]
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