Question

Question 36 4.75 pts Statement of Stockholders' Equity - two (2) questions - This problem does NOT build on the preceding problem, the numbers in the Unadjusted Trial Balance are different Instructions:Please prepare a statement of Stockholders' Equity on your scratch paper based on the following Unadjusted Trial Balance and Additional Information below to answer this question and the next question. You will need to know the ending balance for the retained earnings account and the common stock account Unadjusted Trial Balance As of 12/31/20xx Accounts Debit Credit Cash $10,169 Prepaid Rent 6,000 Supplies 4,000 Building 15,000 Accounts Payable $2,000 Deferred Revenue 10.000 Common Stock 6,000 Retained Earnings 12,000

Answer 1

For preparing the statements of Stockholder’s Equity we have to know the balances of Common stock & Retained Earnings accounts as on 12/31/20xx.

Working Note (WN) # 1:

Computation of Net Income

Particulars	Amount	Amount
Revenue		10169
Less: Expenses:
Rent Expense	1000
Salaries Expense	3000
Insurance Expense	1000	5000
Net IncomeTransferred to Retained Earnings		5169

Ans:

Statement of stockholders' Equity For the Year Ended 12/31/20xx
Particulars	Common Stock	Retained Earnings	Total
Beginning Balance as on 1/1/20xx	6000	12000	18000
Net Income (WN -1)		5169	5169
Ending Balance as on 12/31/20xx	6000	17169	23169

Hence Retained Earnings Account as of 12/31/20xx is 17169