Statement of retained earnings | |||
Particulars | Amount | Amount | |
A. | Balance as on 1 jan | 238000 | |
B. | Less:Correction of depriciation error | 39000 | |
Less: Tax saving ( 40%) | 15600 | -23400 | |
C. | Cumulative increase in prior period Inventory | 49000 | |
Less: Tax saving ( 40%) | 19600 | 29400 | |
D. | Balance as on Jan 1 Adjusted (A) | 244000 | |
E. | Income Before Tax | 350000 | |
F. | Less: Taxes @ 40% | -140000 | |
G. | Income After Tax | 210000 | |
H. | Less: Dividend declared | -100000 | |
I. | Net Income of Yr.2020 (B) | 110000 | |
J. | Retained Earnings balance as on 31 december 2020 (A+B) | 354000 |
Question 3 (5 marks) Spruce Corporation began operations on January 1, 2017. During its first three...
The Bridgeport Corporation, a private company, began operations on January 1, 2017. During its first three years of operations, Bridgeport reported net income and declared dividends as follows: Dividends declared 2017 2018 2019 Net income $50,000 139,000 159,000 50,000 50,000 The following information is for 2020: Income before income tax Correction of prior period error: understatement of 2018 depreciation expense (before tax) Cumulative increase in prior years' income from change in inventory method (before tax) Dividends declared (of this amount,...
Eddie Zambrano Corporation began operations on January 1, 2017. During its first 3 years of operations, Zambrano reported net income and declared dividends as follows. Dividends Declared 2017 2018 2019 Net Income $ 40,000 $ 125,000 $ 160,000 $ $ $ 50,000 50,000 The following information relates to 2020. Income before income tax Prior period adjustment: understatement of 2018 depreciation expense (before taxes) Cumulative decrease in income from change in inventory methods, (before taxes) Dividends declared (of this amount, $25,000...
Skysong Corporation began operations on January 1, 2017. During its first 3 years of operations, Skysong reported net income and declared dividends as follows: 2017 2018 2019 Net income $45,100 132,100 161,100 Dividends declared $-0- 56,400 53,900 The following information relates to 2020. Income before income tax Prior period adjustment: understatement of 2018 depreciation expense (before taxes) Cumulative decrease in income from change in inventory methods (before taxes) Dividends declared (of this amount, $31,500 will be paid on Jan. 15,...
Wildhorse Corporation began operations on January 1, 2017. During its first 3 years of operations, Wildhorse reported net income and declared dividends as follows: Net income Dividends declared 2017 $43,300 $ –0– 2018 126,900 58,000 2019 161,500 55,800 The following information relates to 2020. Income before income tax $230,700 Prior period adjustment: understatement of 2018 depreciation expense (before taxes) $26,700 Cumulative decrease in income from change in inventory methods (before taxes) $45,000 Dividends declared (of this amount, $26,700 will be...
Wildhorse Corporation began operations on January 1, 2017. During its first 3 years of operations, Wildhorse reported net income and declared dividends as follows: Net income Dividends declared 2017 $43,300 $ –0– 2018 126,900 58,000 2019 161,500 55,800 The following information relates to 2020. Income before income tax $230,700 Prior period adjustment: understatement of 2018 depreciation expense (before taxes) $26,700 Cumulative decrease in income from change in inventory methods (before taxes) $45,000 Dividends declared (of this amount, $26,700 will be...
Eddie Zambrano Corporation began operations on January 1, 2017. During its first 3 years of operations, Zambrano reported net income and declared dividends as follows: Net income Dividends declared 2017 $40,000 $ –0– 2018 125,000 50,000 2019 160,000 50,000 The following information relates to 2020. Income before income tax $240,000 Understatement of 2018 depreciation expense (before taxes) $25,000 Cumulative decrease in income from change in inventory methods (before taxes) $35,000 Dividends declared $100,000 Effective tax rate 20 % 1. Instructions:...
Coronado Corporation began operations on January 1, 2017. During its first 3 years of operations, Coronado reported net income and declared dividends as follows: Net income Dividends declared 2017 $45,600 $ –0– 2018 134,600 55,900 2019 165,000 51,200 The following information relates to 2020. Income before income tax $221,600 Prior period adjustment: understatement of 2018 depreciation expense (before taxes) $33,700 Cumulative decrease in income from change in inventory methods (before taxes) $36,200 Dividends declared (of this amount, $33,700 will be...
Oriole Corporation began operations on January 1, 2017. During its first 3 years of operations, Oriole reported net income and declared dividends as follows: Net income Dividends declared 2017 $46,500 $ –0– 2018 135,000 53,900 2019 162,300 53,400 The following information relates to 2020. Income before income tax $234,700 Prior period adjustment: understatement of 2018 depreciation expense (before taxes) $26,000 Cumulative decrease in income from change in inventory methods (before taxes) $35,500 Dividends declared (of this amount, $26,000 will be...
Blue Corporation began operations on January 1, 2017. During its first 3 years of operations, Blue reported net income and declared dividends as follows: 2017 2018 2019 Net Income $43,800 134,500 162,400 Dividends declared $-0- 51,300 52,500 The following information relates to 2020. Income before income tax Prior period adjustments understatement of 2018 depreciation expense (before taxes) Cumulative decrease in income from change in inventory methods (before taxes) Dividends declared (of this amount. $25,400 will be paid on Jan 15,...
Waterway Corporation began operations on January 1, 2017. During its first 3 years of operations, Waterway reported net income and declared dividends as follows: Net income Dividends declared 2017 $47,600 $ –0– 2018 132,500 57,700 2019 165,000 52,900 The following information relates to 2020. Income before income tax $233,800 Prior period adjustment: understatement of 2018 depreciation expense (before taxes) $34,700 Cumulative decrease in income from change in inventory methods (before taxes) $40,100 Dividends declared (of this amount, $34,700 will be...