The balance sheet items of Mercer Company as of December 31, 2011, follow in ran
ID: 2802942 • Letter: T
Question
The balance sheet items of Mercer Company as of December 31, 2011, follow in random order. You are to prepare a balance sheet for the company, using a similar sequence for assets as illustrated in Exhibit 2–9. You must compute the amount for Retained Earnings.
MERCER COMPANY
BALANCE SHEET
DECEMBER 31, 2011,
Asset Liability and Owners’ Equity
Cash --------------------------$ 36,300
Account receivables------ $ 56.700
Office equipment---------- $ 12,400
Land--------------------------$ 90,000
Building ------------------- $ 210,000
Total--------------------------
QUESTION
A.compute the amount for Retained Earnings.
Liability;
Notes payable----------$207,000
Account payable---------$43,800
Total liabilities-------
Owners’ Equity
Capital stock------------- $75,000
Retained Earnings------- $ 79.600
Total -------------------------
MERCER COMPANY
BALANCE SHEET
DECEMBER 31, 2011,
Asset Liability and Owners’ Equity
Cash --------------------------$ 36,300
Account receivables------ $ 56.700
Office equipment---------- $ 12,400
Land--------------------------$ 90,000
Building ------------------- $ 210,000
Total--------------------------
QUESTION
A.compute the amount for Retained Earnings.
Liability;
Notes payable----------$207,000
Account payable---------$43,800
Total liabilities-------
Owners’ Equity
Capital stock------------- $75,000
Retained Earnings------- $ 79.600
Total -------------------------
Explanation / Answer
Retained earnings= Total Assets-(liabilities+capital stock)= 405,400-(250,800+75,000)
Retained earnings= $79600
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