Presented below are changes in all the account balances of Splish Furniture Co.

Question

Presented below are changes in all the account balances of Splish Furniture Co. during the current year, except for retained earnings. Increase (Decrease) Increase (Decrease) $(52,120) Cash Accounts Receivable (net) Inventory Investments $70,960 Accounts Payable 84,090 127,800 47850) Paid-In Capital in Excess of Par-Common Stock 15,390 51,200 Bonds Payable 134,200 Common Stock Compute the net income for the current year, assuming that there were no entries in the Retained Earnings account except for net income and a dividend declaration of $26,090 which was paid in the current year. Net income 90220

Explanation / Answer

Assets Cash 70960 Accounts receivable 51200 Inventory 134200 Investments -47850 Total assets 208510 Liabilities and stockholders equity Accounts payable -52120 Bonds payable 84090 Common stock 127800 Paid in capital in excess of par 15390 Total 175160 Change in Retained earnings 33350 (208510-175160) Change in retained earnings 33350 Add Dividend 26090 Net income 59440

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