Comparative statements of retained earnings for Renn-Dever Corporation were repo
ID: 2490827 • Letter: C
Question
Comparative statements of retained earnings for Renn-Dever Corporation were reported in its 2016 annual report as follows.
RENN-DEVER CORPORATION
Statements of Retained Earnings
For the Years Ended December 31,
2016 2015 2014
Balance at beginning of year $6,794,292 $5,464,052 $5,624,552
Net income (loss) 3,308,700 2,240,900 (160,500)
Deductions:
Stock dividend (34,900 shares) 242,000
Common shares retired (110,000 shares) 212,660
Common stock cash dividends 889,950 698,000 0
Balance at end of year $8,971,042 $6,794,292 $5,464,052
At December 31, 2013, common shares consisted of the following:
Common stock, 1,855,000 shares at $1 par $1,855,000
Paid-in capital—excess of par 7,420,000
Required: Infer from the reports the events and transactions that affected Renn-Dever Corporation’s retained earnings dur-ing 2014, 2015, and 2016. Prepare the journal entries that reflect those events and transactions.
Explanation / Answer
Solution:
(A). Caluculation of Ratained Earnings:
Retained Earnings
(B). Journal Entries:
(1).
Cash 92,75,000
Common Stock 18,55,000
Paid-in capital 74,20,000
( To record the Common Stock Issued at Par)
Particulars 2016 2015 2014 BeginingRetained Earnings $67,94,292 $54,64,052 $56,24,552 Add: Net Income 3,308,700 2,240,900 (160,500) Less:Stock Divideneds Paid 242,000 212,660 0 Less: Cash Dividend Paid 889,950 698,000 0 Ending Reataned Earnings $8,971,042 $6,794,292 $5,464,052Related Questions
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