On January 1, 2014, Mather Corporation had Retained Earnings of $625,000. During

Question

On January 1, 2014, Mather Corporation had Retained Earnings of $625,000. During the year, Mather had the following selected transactions:

Prepare a Retained Earnings Statement for the year.

1. Declared stock dividends of $40,000. 2. Declared cash dividends of $50,000. 3. A 2 for 1 stock split involving the issue of 200,000 shares of $5 par value common stock for 100,000 shares of $10 par value common stock. 4. Suffered a net loss of $80,000. MATHER CORPORATION Retained Eanings Statement For the Year Ended December 31, 2014

Explanation / Answer

Solution:

MATHER CORPORATION Retained Earnings Statement For the Year Ended December 31, 2014 Beginning Balance 6,250,000 Less: Cash dividends 50,000 Stock Dividends 40,000 Net Loss 80,000 170,000 Ending Balance 6,080,000

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