Values listed for the Retained Earnings & Notes Payable table are: - 2017 Net In
ID: 2569168 • Letter: V
Question
Values listed for the Retained Earnings & Notes Payable table are:
- 2017 Net Income
- 2017 Net Loss
- Dividends Paid
- Dividends Receivable
Please show how to fill in the values on the tables above!
A comparative balance sheet and income statement is shown for Cruz, Inc. CRUZ, INC. Comparative Balance Sheets December 31, 2017 2017 2016 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Furniture Accum. depreciation-Furniture Total assets $. 91,100 22,900 48,600 91,300 4,100 166,900 116,200 (16,200 (8,700 $306,000 $274,400 39,100 81,800 5,200 217,200 105,000 Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long-term) Total liabilities Equity Common stock, $5 par value Retained earnin 20,200 4,500 2,500 27,200 66,400 93,600 $. 14,400 8,600 1,400 24,400 28,900 :0 53, 300 216,400 36,300 172,100 8,700 $274,400 gs Total liabilities and equity $306,000Explanation / Answer
Cash dividends are paid to the shareholders through the available retained profits/earnings of the corporation. The current year income is added to the retained earnings every year and the dividends are paid out of the available earnings at the end of the year or during (interim) the year.
Beginning balance of Retained earnings = $8700
Add: Profits earned during the year = $28800
Less: Ending balance = $36300
Dividends paid for the year = $1200
As there was no additional notes payable issued in 2017, the difference between the notes payable balance in the two years will be treated as the cash amount paid to reduce the notes payable balance in 2017.
Beginning balance of Note payable = $66400
Less: Ending balance of Notes payable = $28900
Cash amount paid to Notes payable = $37500
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