The following information is available for Amos Company for the year ended Decem

Question

The following information is available for Amos Company for the year ended December 31, 2017 a. Balance of retained earnings, December 31, 2016, prior to discovery of error, $867,000 b. Cash dividends declared and paid during 2017, $25,00o. c. It neglected to record 2015 depreciation expense of $46,600, which is net of $5,500 in tax benefits. d. The company earned $212,000 in 2017 net income Prepare a 2017 statement of retained earnings for Amos Company. (Amounts to be deducted should be indicated with a minus sign.) AMOS COMPANY Statement of Retained Earnings For Year Ended December 31, 2017 Adjusted retained earnings, December 31, 2016 $ 867,000 Prior period adjustment Depreciation expense error in 2015 (net of tax)5,500 Adjusted retained earnings, December 31, 2016861,500 Add: Net income Less: Dividends Retained earnings, December 31, 2017 212,000 46,600 $ 1,120,100

Explanation / Answer

Statement of retained earnings :

Retained earnings, December 31,2016 867000 Prior period adjustment Depreciation expense error in 2015 (net of tax) -41100 Adjusted retained earnings, December 31,2016 825900 Add: Net income 212000 Less: Dividends -46600 Retained earnings, December 31,2017 991300

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