On January 1, 2010, Maplewood Corporation had the following balances in its stoc

Question

On January 1, 2010, Maplewood Corporation had the following balances in its stockholders' equity accounts: Common stock, $100,000 (10,000 shares of $10 par value stock); contributed capital in excess of par, $20,000; and retained earnings, $50,000. During 2010, the company issued 2,000 additional shares of common stock for $15 per share, reported net income of $60,000 and paid cash dividends of $20,000. What amount of retained earnings would Calley Corporation report on its December 31, 2010 balance sheet?

Explanation / Answer

Answer:

Particulars Amount ($) Opening balance of Retained earnings 50000 Add: Net income 60000 Less: Dividend 20000 Closing balance of retained earnings 90000

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