Question

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Save Score: 0.86 of 1 pt 1 of 1 (1 complete) HW Score: 85.85%, 0.86 of 1 pt ents 2 CP2-42 (similar to) "work Question Help Anna and Zed decide that they will create a new corporation, Wonder Wilderness Company, or wwC for short. Wonder Wilderness Company is a service based company that rents canoes for use on local lakes and rivers. The business began operations on November 1, 2018 and completed the following transactions in that first month. iz/Ter A (Click the icon to view the Noember transactions.) In addition, Wonder Wilderness Company completed the following transactions for Deoember. (Click the icon to view the December transactions.) (Click the icon to view the transaction analysis chart from November.) Read the requirements Requirement 5. Prepare the statement of retained eamings for the two months ended December 31, 2018. Enter any increases in retained eanings prior to the subtotal and any decreases to retained earnings below the subtotal. (Enter a "0" for any zero balances.) (Click to view the trial balance you prepared in Requirement 3.) Wonder Wilderness Company Statement of Retained Earnings Choose from any list or enter any number in the input fields and then click Check Answer. 2 parts remaining Clear All Check Answer

Answer 1

Solution:

Wonder Wilderness Company
Statement of Retained earnings
Two Months Ended December 31,2018
Retained Earnings, November 1,2018	$                               -
Add: Net income (Note: 1)	$                        6,140
Subtotal	$                        6,140
(Less): Dividends (Given)	$                     (1,100)
Retained Earnings, December 31,2018	$                        5,040

Notes:

1) Calculation of Net Income:

Wonder Wilderness Company
Income statement
Two Months Ended December 31,2018
Revenue
Canoe Rental Revenue(A)		$ 12,500
Operating Expenses
Rent Expense	$    1,600
Wages Expense	$    4,000
Utilities Expense	$        320
Telephone Expense	$        440
Total Operating Expense (B)		$    6,360
Net Income (A-B)		$    6,140

2) Retained Earnings Beginning Balance is zero because 1st November is the business incorporated date. So, No beginning Balance.