Question

Given the following information about Cullumber Sporting Goods, Inc., construct a balance sheet for June 30, 2017. On that date the firm had cash and marketable securities of $25,135, accounts receivables of $43,758, inventory of $167,000, net fixed assets of $329,700, and other assets of $13,125. It had accounts payables of $67,855, notes payables of $36,454, long-term debt of $223,100, and common stock of $150,000. How much retained earnings did the firm have?

Answer 1

Balance sheet of Cullumber Sporting Goods, Inc. will look like below:

Balance Sheet as on June 30, 2017
Assets	Liabilities
Cash & Marketable Securities	$           25,135	Accounts Payable	$            67,855
Accounts Receivable	$           43,758	Notes Payable	$            36,454
Inventory	$       1,67,000	Current liabilities	$        1,04,309
other assets	$           13,125
Current Assets	$       2,49,018	Long-term debt	$        2,23,100
		Common stock	$        1,50,000
Net fixed assets	$       3,29,700	Retained earning	$        1,01,309
Total assets	$       5,78,718	Total liabilities	$        5,78,718

We know that, Total liabilities = total assets = Current assets + Net fixed assets

=> Total liabilities = 25135 + 43758 + 167000 + 13125 + 329700 = $578718

Also, retained earning = Total liabilities - Current liabilities - Long-term Debt - Common stock.

=> Retained earning = 578718 - 67855 - 36454 - 223100 - 150000 = $101309