Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
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Chapter 13, Problem 15E
To determine
Prepare a statement of
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The following information is from Amos Company for the year ended December 31, 2019. Prepare a statement of retained earnings for Amos Company. ∙ Retained earnings at December 31, 2018 (before discovery of error), $1,375,000. ∙ Cash dividends declared and paid during the year, $43,000. ∙ Two years ago, it forgot to record depreciation expense of $55,500 (net of tax benefit). ∙ The company earned $126,000 in net income this year.
Bang Company reported a Retained Earnings balance of P150,000 on December 31, 2021. The following occurred during 2022:
Net income was P85,000
Dividends declared and paid was P60,000
An error on the 2020 depreciation expense revealed understatement of P25,000. Tax rate is 25%.
How much should be presented as the correct beginning balance of the Retained Earnings account for 2022?
How much should be presented as the ending balance of the Retained Earnings account for 2022?
Metlock Corporation has retained earnings of $681,500 at January 1, 2020. Net income during 2020 was $1,434,800, and cash dividends declared and paid during 2020 totaled $81,300. Prepare a retained earnings statement for the year ended December 31, 2020. Assume an error was discovered: land costing $88,800 (net of tax) was charged to maintenance and repairs expense in 2019.
Chapter 13 Solutions
Principles of Financial Accounting.
Ch. 13 - A corporation issues 6,000 shares of 5 par value...Ch. 13 - A company reports net income of 75,000. Its...Ch. 13 - A company has 5,000 shares of 100 par preferred...Ch. 13 - A company paid cash dividends of 0.81 per share....Ch. 13 - Prob. 5MCQCh. 13 - What are organization expenses? Provide examples.Ch. 13 - How are organization expenses reported?Ch. 13 - Prob. 3DQCh. 13 - What is the difference between authorized shares...Ch. 13 - Prob. 5DQ
Ch. 13 - List the general rights of common stockholders.Ch. 13 - What is the difference between the market value...Ch. 13 - Identify and explain the importance of the three...Ch. 13 - Prob. 9DQCh. 13 - How does declaring a stock dividend affect the...Ch. 13 - What is the difference between a stock dividend...Ch. 13 - Prob. 12DQCh. 13 - Prob. 13DQCh. 13 - How is book value per share computed for a...Ch. 13 - Prob. 15DQCh. 13 - Prob. 16DQCh. 13 - Prob. 17DQCh. 13 - Prob. 1QSCh. 13 - Issuance of common stock Prepare the journal entry...Ch. 13 - Issuance of par and stated value common stock...Ch. 13 - Issuance of no-par common stock Prepare the...Ch. 13 - Prob. 5QSCh. 13 - Accounting for cash dividends Prepare journal...Ch. 13 - Prob. 7QSCh. 13 - Accounting for small stock dividend The...Ch. 13 - Prob. 9QSCh. 13 - Accounting for dividends For each of the following...Ch. 13 - Preferred stock issuance and dividends 1. Prepare...Ch. 13 - Dividend allocation between classes of...Ch. 13 - Prob. 13QSCh. 13 - Prob. 14QSCh. 13 - Purchase and sale of treasury stock On May 3,...Ch. 13 - Prob. 16QSCh. 13 - Prob. 17QSCh. 13 - For each situation, identify whether it is treated...Ch. 13 - Prob. 19QSCh. 13 - Basic earnings per share Murray Company reports...Ch. 13 - Epic Company earned net income of 900,000 this...Ch. 13 - Price-earnings ratio Compute Topp Companys...Ch. 13 - Prob. 23QSCh. 13 - Book value per common share The stockholders...Ch. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Accounting for par, stated, and no-par stock...Ch. 13 - Recording stock issuances Prepare journal entries...Ch. 13 - Stock issuance for noncash assets Sudoku Company...Ch. 13 - On June 30, Sharper Corporations stockholders...Ch. 13 - Prob. 7ECh. 13 - The stockholders equity section of TVX Company on...Ch. 13 - Prob. 9ECh. 13 - Yorks outstanding stock consists of 80,000 shares...Ch. 13 - Prob. 11ECh. 13 - Prob. 12ECh. 13 - In Draco Corporations first year of business, the...Ch. 13 - Prob. 14ECh. 13 - Prob. 15ECh. 13 - Prob. 16ECh. 13 - Prob. 17ECh. 13 - Price-earnings ratio computation and...Ch. 13 - Prob. 19ECh. 13 - The equity section of Cyril Corporations balance...Ch. 13 - Prob. 21ECh. 13 - Stockholders equity transactions and analysis...Ch. 13 - Prob. 2APCh. 13 - Prob. 3APCh. 13 - The equity sections for Atticus Group at the...Ch. 13 - Prob. 5APCh. 13 - Stockholders equity transactions and analysis...Ch. 13 - Balthus Corp. reports the following components of...Ch. 13 - Prob. 3BPCh. 13 - Prob. 4BPCh. 13 - Prob. 5BPCh. 13 - Santana Rey created Business Solutions on October...Ch. 13 - Prob. 1AACh. 13 - Use the following comparative figures for Apple...Ch. 13 - Prob. 3AACh. 13 - Prob. 1BTNCh. 13 - Access the March 1, 2017, fi ling of the 2016...Ch. 13 - Prob. 5BTN
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- Shannon Corporation began operations on January 1, 2019. Financial statements for the years ended December 31, 2019 and 2020, contained the following errors: In addition, on December 31, 2020, fully depreciated machinery was sold for 10,800 cash, but the sale was not recorded until 2021. There were no other errors during 2019 or 2020, and no corrections have been made for any of the errors. Refer to the information for Shannon Corporation above. Ignoring income taxes, what is the total effect of the errors on the amount of working capital (current assets minus current liabilities) at December 31, 2020? a. working capital overstated by 4,200 b. working capital understated by 5,800 c. working capital understated by 6,000 d. working capital understated by 9,800arrow_forwardBrooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and taxable income for 2020. The prior period adjustment was the result of an error in calculating bad debt expense for 2019. The current tax rate is 30%, and no change in the tax rate has been enacted for future years. When the company applies intraperiod income tax allocation, the prior period adjustment will be shown on the: a. income statement at 12,000 b. income statement at 8,400 (net of 3,600 income taxes) c. retained earnings statement at 12,000 d. retained earnings statement at 8,400 (net of 3,600 income taxes)arrow_forwardAt January 1, 2020, Crane Company reported retained earnings of $1,938,000. In 2020, Crane discovered that 2019 depreciation expense was understated by $387,600. In 2020, net income was $822,000 and dividends declared were $205,000. The tax rate is 20%. Prepare a 2020 retained earnings statement for Crane Company. CRANE COMPANY Retained Earnings Statementarrow_forward
- The records of Culver Corp. for calendar 2023 reflected the following correct pre-tax amounts: gain from discontinued operations, $44,000; cash dividends declared and paid, $39,600; retained earnings, January 1, 2023, $242,000, correction of accounting error, $30,800 debit; income before income taxes and before discontinued operations, $145,200. The average income tax rate of 40 % applies to all items except the dividends. Calculate the December 31, 2023 ending balance of retained earnings. Ending balance of retained earningsarrow_forwardBlue Corporation has retained earnings of $689,900 at January 1, 2020. Net income during 2020 was $1,529,000, and cash dividends declared and paid during 2020 totaled $80,700. Prepare a retained earnings statement for the year ended December 31, 2020. Assume an error was discovered: land costing $87,420 (net of tax) was charged to maintenance and repairs expense in 2019. (List items that increase retained earnings first.)arrow_forwardWildhorse Corporation has retained earnings of $677,100 at January 1, 2020. Net income during 2020 was $1,511,100, and cash dividends declared and paid during 2020 totaled $81,600. Prepare a retained earnings statement for the year ended December 31, 2020. Assume an error was discovered: land costing $87,330 (net of tax) was charged to maintenance and repairs expense in 2019. (List items that increase retained earnings first.) WILDHORSE CORPORATIONRetained Earnings Statementchoose the accounting period December 31, 2020For the Year Ended December 31, 2020For the Quarter Ended December 31, 2020 select an opening name Correction for Overstatement of Expenses in Prior PeriodCash DividendsExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues…arrow_forward
- Allen Company's 2019 income statement reported total revenues, $860,000 and total expenses (including $41,000 depreciation) of $730,000. The company's accounting records showed the following: accounts receivable-beginning balance, $51,000 and ending balance, $40,900; accounts payable -beginning balance, $23,000 and ending balance, $28,900. Therefore, based only on this information, how much was the 2019 net cash provided by operating activities? Multiple Choice $125,800. $175,200. $187,000. $166,800.arrow_forwardBased on the accounting records, the total assets book value as of January 1, 2021 is P1,875,362.99 but due to inflation the current cost is determined to be P1,990,800.21 while the total liabilities is P988,123.54 as of January 1, 2021. The company received additional investments of P651,345.22 during the year while dividends declared and paid is P450,650. At the end of the year, the books reported Total assets of P2,992,748.55 and liabilities of P1,555,661.24. What is the net income (loss) under the physical capital concept?arrow_forwardThe following information relates to Sustagoon Ltd. Profit before tax for the year ended 30 June 2020 was $504,400. The following items were used in determining that profit: Sales revenue 1,450,800 Cost of sales 608,400 Selling expenses 156,000 Administrative expenses 93,600 Other expenses 57,200 Interest expense 31,200 504,400 Other events which occurred during the year: Gain on revaluation of land 26,000 Assume the company’s taxation rate is 30c in the dollar. Required: Prepare a statement of profit or loss and other comprehensive income for the year ended 30 June 2020, in accordance with the requirements of AASB 101. Based on the information received determine whether to disclose by function or nature. Ignore comparatives as the information is not provided.arrow_forward
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