In: Accounting
Prat Corp. started the 2018 accounting period with $31,000 of assets (all cash), $12,500 of liabilities, and $16,000 of common stock. During the year, the Retained Earnings account increased by $16,550. The bookkeeper reported that Prat paid cash expenses of $31,500 and paid a $3,100 cash dividend to the stockholders, but she could not find a record of the amount of cash that Prat received for performing services. Prat also paid $5,500 cash to reduce the liability owed to the bank, and the business acquired $6,900 of additional cash from the issue of common stock.
Opening bal of cash | $ 31,000 |
Issue of common stock | $ 6,900 |
Increase in retained earnings | $ 16,550 |
Paid cash expenses | $ -31,500 |
Paid cash dividend | $ -3,100 |
Paid cash to reduce liability | $ -5,500 |
Closing cash balance | $ 14,350 |
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