Below is the retained earnings account for the year 2007 forLeClair Corp Retaine

Question

Below is the retained earnings account for the year 2007 forLeClair Corp Retained earnings Jan 12007                                                                                       257,600 Add: Gain on sale ofinvestments(net&tax)                                                 41,200 netincome                                                                                          84,500 refund on litigation with gov, related to year 2004(net oftax)               21,600 recognition of income earned in 2006, but omitted fromincome statement in that year (net andtax)                                                      25,400               172,700                                                                                                          --------               ----------                                                                                                                                     430,300 deduct: loss on discontinued operations(net oftax)                                          25,000 write-off of goodwill (net oftax)                                                          60,000 cumulative effect on income of prior years in changingfrom LIFO to FIFO inventory valuation in 2007 (net oftax)                           18,200 cash dividendsdeclared                                                                         32,000               135,200                                                                                                             ----------            --------- retained earnings, dec 312007                                                                                          295,100 instructions: a) prepare a corrected retained earnings statement. LeClair Corp. normally sells investments of the type mentioned above. FIFO inventory was used in 2007 tocompute net income. b) state where teh items that do not appear in teh correctedretained earnings statement should be shown. Below is the retained earnings account for the year 2007 forLeClair Corp Retained earnings Jan 12007                                                                                       257,600 Add: Gain on sale ofinvestments(net&tax)                                                 41,200 netincome                                                                                          84,500 refund on litigation with gov, related to year 2004(net oftax)               21,600 recognition of income earned in 2006, but omitted fromincome statement in that year (net andtax)                                                      25,400               172,700                                                                                                          --------               ----------                                                                                                                                     430,300 deduct: loss on discontinued operations(net oftax)                                          25,000 write-off of goodwill (net oftax)                                                          60,000 cumulative effect on income of prior years in changingfrom LIFO to FIFO inventory valuation in 2007 (net oftax)                           18,200 cash dividendsdeclared                                                                         32,000               135,200                                                                                                             ----------            --------- retained earnings, dec 312007                                                                                          295,100 instructions: a) prepare a corrected retained earnings statement. LeClair Corp. normally sells investments of the type mentioned above. FIFO inventory was used in 2007 tocompute net income. b) state where teh items that do not appear in teh correctedretained earnings statement should be shown.

Explanation / Answer

Below is the retained earnings account for the year 2007 forLeClair Corp Retaine

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