Question

Statement of retained earnings. Use the data from the following financial statements in the popup​ window, LOADING.... The company paid interest expense of $ 17 comma 600 for 2017 and had an overall tax rate of 40 % for 2017. Complete the statement of retained earnings for 2017​, and determine the dividends paid last year.

Partial Income Statement Year Ending 2017
Sales revenue	$350,100
Cost of goods sold	$141,800
Fixed costs	$42,800
Selling, general, and administrative expenses	$27,900
Depreciation	$45,900

Partial Balance Sheet 12/31/2016
ASSETS		LIABILITIES
Cash	$16,100	Notes payable	$13,800
Accounts receivable	$28,000	Accounts payable	$18,900
Inventories	$47,900	Long-term debt	$190,200
Fixed assets	$368,000	OWNERS' EQUITY
Accumulated depreciation (-)	$143,700	Retained earnings
Intangible assets	$82,100	Common stock	$131,900

Partial Balance Sheet 12/31/2017
ASSETS		LIABILITIES
Cash	$25,900	Notes payable	$12,100
Accounts receivable	$18,900	Accounts payable	$24,000
Inventories	$53,200	Long-term debt	$162,100
Fixed assets	$447,900	OWNERS' EQUITY
Accumulated depreciation (-)		Retained earnings
Intangible assets	$82,000	Common stock	$181,800

PrintDone

Answer 1

We have calculated following missing parts in the balance sheet of 2016 and 2017

Total assets = total liabilities + owner’s equity

Retained earnings of 2016 calculation:

Total liabilities + equities = 398,400 (same as total assets of 2016)

So to calculated the missing part i.e. retained earnings = 398,400 – all liabilities – common stock

=$43,600

Accumulated depreciation of 2017 = 2016 closing depreciation + depreciation in 2017 = 143,700+45,900 = 189,600

Now retained earnings of 2017 can be calculated in the same way as calculated above in 2016 (please see above calculation) = 58,300

Retained earnings 2016+ net profit 2017 – dividend 2017 = Retained earnings 2017

43,600+44,460-dividend 2017 = 58,300

Dividend 2017 = 43,600+44,460-58,300= $29,760

So Dividend 2017 = $29,760