The information presented here represents selected data from the December 31, 20
ID: 2424312 • Letter: T
Question
The information presented here represents selected data from the December 31, 2013, balance sheet and income statements for the year then ended.
Retained earnings, December 31, 2013 $315,450
Decrease in total liabilities during 2013 $68,700
Gain on the sale of buildings during 2013 $24,150
Dividends declared and paid in 2013 $6,750
Proceeds from sale of common stock in 2013 $74,100
Net income for the year ended December 31, 2013 $33,900
Required: Prepare the Statement of Stockholders' Equity for the year ended December 31, 2013 and calculate the retained earnings balance as of December 31, 2012. (Negative amount should be indicated by a minus sign.)
Explanation / Answer
1. Retained earnings balance as of December 31, 2012 = Retained earnings, December 31, 2013 – [ Net income for the year ended December 31, 2013 + Decrease in total liabilities during 2013 + Gain on the sale of buildings during 2013] + Dividends declared and paid in 2013
=$315,450 – ($33,900 +$68,700 +$24,150) + $6,750
= $195450
Statement of Stockholders' Equity
for the year ended December 31, 2013
Common stock
Retained earnings
Total stockholders equity
Balance on january1
XXX
195450
$195450
Issued share
$74,100
-
$74,100
Purchase of treasury stock
-
-
-
Net income
-
126750
$126750
Cash dividend
-
6750
$6750
Stock dividend
-
Balance on December 31
$74100
315450
$389550
Statement of Stockholders' Equity
for the year ended December 31, 2013
Common stock
Retained earnings
Total stockholders equity
Balance on january1
XXX
195450
$195450
Issued share
$74,100
-
$74,100
Purchase of treasury stock
-
-
-
Net income
-
126750
$126750
Cash dividend
-
6750
$6750
Stock dividend
-
Balance on December 31
$74100
315450
$389550
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.