Question
In: Accounting
Comparative statements of retained earnings for Renn-Dever Corporation were reported in its 2018 annual report as...
Comparative statements of retained earnings for Renn-Dever
Corporation were reported in its 2018 annual report as
follows.
| RENN-DEVER CORPORATION Statements of Retained Earnings |
|||||||||
| For the Years Ended December 31, | 2018 | 2017 | 2016 | ||||||
| Balance at beginning of year | $ | 7,011,452 | $ | 5,696,552 | $ | 5,864,552 | |||
| Net income (loss) | 3,448,700 | 2,340,900 | (168,000 | ) | |||||
| Deductions: | |||||||||
| Stock dividend (35,500 shares) | 248,500 | ||||||||
| Common shares retired (124,000 shares) | 248,000 | ||||||||
| Common stock cash dividends | 919,950 | 778,000 | 0 | ||||||
| Balance at end of year | $ | 9,291,702 | $ | 7,011,452 | $ | 5,696,552 | |||
At December 31, 2015, common shares consisted of the
following:
| Common stock, 1,865,000 shares at $1 par | $ | 1,865,000 |
| Paid-in capital—excess of par | 7,460,000 | |
Required:
Infer from the reports the events and transactions that affected
Renn-Dever Corporation’s retained earnings during 2016, 2017, and
2018. Prepare the journal entries that reflect those events and
transactions. (If no entry is required for a
transaction/event, select "No journal entry required" in the first
account field.)
(Journal Entries):
Record transfer of net loss to retained earnings.
Record transfer of net income to retained earnings.
Record repurchase of shares for retirement.
Record declaration of cash dividend.
Record payment of cash dividend.
Record transfer of net income to retained earnings
Record issue of stock dividend.
Record declaration of cash dividend.
Record payment of cash dividend.
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Expert Solution
|
Date |
General journal |
Debit |
Credit |
|
2016 |
Retained earnings |
168000 |
|
|
Income summary |
168000 |
||
|
(Record transfer of net loss to retained earnings) |
|||
|
2017 |
Income summary |
2340900 |
|
|
Retained earnings |
2340900 |
||
|
(Record transfer of net income to retained earnings) |
|||
|
Common stock |
124000 |
||
|
Paid-in capital - excess of par (124000*(7460/1865)) |
496000 |
||
|
Retained earnings |
248000 |
||
|
Cash |
868000 |
||
|
(Record repurchase of shares for retirement) |
|||
|
Retained earnings |
778000 |
||
|
Cash dividends payable |
778000 |
||
|
(Record declaration of cash dividend) |
|||
|
Cash dividends payable |
778000 |
||
|
Cash |
778000 |
||
|
(Record payment of cash dividend) |
|||
|
2018 |
Income summary |
3448700 |
|
|
Retained earnings |
3448700 |
||
|
(Record transfer of net income to retained earnings) |
|||
|
Retained earnings |
248500 |
||
|
Common stock |
35500 |
||
|
Paid-in capital - excess of par |
213000 |
||
|
(Record issue of stock dividend) |
|||
|
Retained earnings |
919950 |
||
|
Cash dividends payable |
919950 |
||
|
(Record declaration of cash dividend) |
|||
|
Cash dividends payable |
919950 |
||
|
Cash |
919950 |
||
|
(Record payment of cash dividend) |
ekkarill92 answered 5 months agoRelated Solutions
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Comparative statements of retained earnings for Renn-Dever
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3,408,700 2,300,900 (165,000 ) Deductions: Stock dividend (34,500
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