The revenues and expenses of Paradise Travel Service for the year ended May 31,

Question

The revenues and expenses of Paradise Travel Service for the year ended May 31, 2018, follow: Accounts Fees earned $808,500 Office expense 295,200 Miscellaneous expense 10,300 Wages expense 450,400 Everett McCauley invested an additional $40,000 in the business in exchange for common stock, and $14,600 of dividends were paid during the year. Retained earnings as of June 1, 2017, was $365,000. Prepare a retained earnings statement for the year ended May 31, 2018. Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. “Less” or “Add” is not required. A decrease to retained earnings should be entered as a negative amount.

Explanation / Answer

Prepare a retained earnings statement for the year ended May 31, 2018.

Beginning retained earnings 365000 Net income 52600 Dividend (14600) Ending retained earnings 403000

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