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Statement of retained earnings. Use the data from the following financial statements in the popup​ window,...

Statement of retained earnings. Use the data from the following financial statements in the popup​ window,

LOADING...The company paid interest expense of $18,000 for 2017and had an overall tax rate of 40 % for 2017. Complete the statement of retained earnings for 2017, and determine the dividends paid last year.

The distributed earnings is . (Round to the nearest​ dollar.)

Complete the statement of retained​ earnings:  ​(Round to the nearest​ dollar.)

Statement of Retained Earnings

Year Ending December 31, 2017

Beginning balance $

Add net income $

Subtract dividends $

Ending balance $

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

$28,100

Depreciation

$45,800

Partial Balance Sheet 12/31/2016

ASSETS

LIABILITIES

Cash

$16,200

Notes payable

$14,100

Accounts receivable

$27,800

Accounts payable

$18,900

Inventories

$48,200

Long-term debt

$190,100

Fixed assets

$367,900

OWNERS' EQUITY

Accumulated depreciation (-)

$140,500

Retained earnings

Intangible assets

$81,800

Common stock

$131,900

Partial Balance Sheet 12/31/2017

ASSETS

LIABILITIES

Cash

$26,000

Notes payable

$12,200

Accounts receivable

$19,000

Accounts payable

$24,000

Inventories

$53,000

Long-term debt

$161,800

Fixed assets

$448,000

OWNERS' EQUITY

Accumulated depreciation (-)

Retained earnings

Intangible assets

$82,100

Common stock

$181,800

Solutions

Expert Solution

Opening retained earnings = Total assets -liabilities – common stock

= (16200+27800+48200+367900-140500+ 81800) – (14100+18900+190100) – 131900

=401400- 223100 -131900

=46400

Accumulated depreciation = 140500+ 45800 = 186300

Closing retained earnings = (26000+19000+ 53000+ 448000-186300+ 82100)-(12200+24000+161800)-181800

= 441800-198000 - 181800

=62000

Net Income = Sales -cost of goods sold – fixed costs-SG&A expenses – depreciation – Interest * (1-Tax)

= (350100-141800-42800-28100-45800-18000)*(1-0.4)

=73600* 0.6

= 44160

Amount transferred to retained earnings= 62000-46400 = 15600

Hence dividend = Net income – amount transferred

= 44160-15600

= 28560

Statement of Retained earnings

Beginning balance          46400

Add: Net Income             44160

Less: Dividends               28560

Closing Balance               62000

jeff jeffy answered 1 year ago
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