Question

to meducation.com/hmt? 09012915692970285 1581948017683 Exercise 4-5 Record transactions and calculate financial statement amounts LO 2, 6,7 The transactions relating to the formation of Blue Co Stores, Inc., and its first month of operations follow a. The firm was organized and the stockholders invested cash of $7.900 b. The firm borrowed 55,400 from the bank, a short-term note was signed c. Display Cases and other store equipment costing $1,600 were purchased for cash. The original ist price of the equipment was $1.950, but a discount was received because these was having a sale d. A store location was rented, and $1.500 was paid for the first month's rent .. Inventory of $15,800 was purchased: 58.800 cash was paid to the suppliers, and the balance will be paid within 30 days. 1. During the first week of operations, merchandise that had cost $4,000 was sold for $6,000 cash g. A newspaper ad costing $140 was arranged for tran during the second week of the store's operations. The ad will be paid for in the next month h. Additional inventory costing $4,250 was purchased cash of $1,200 was paid, and the balance is due in 30 days In the last three weeks of the first month sales totaled $13,000, of which $10,000 was sold on account. The cost of the goods sold totaled 50.200. Employee wages for the month totaled $1.000, these will be paid during the first week of the next month The firm collected a total of $3.500 from the sales on account recorded in transaction LThe firm paid a total of 4 800 of the amount owed to suppliers from transaction Required: a. Record each transaction in the appropriate columns (if an transaction/Adjustment are not affecting the balance sheet category or income statement, leave the cells blank Enter decreases to account balances as a negative.) Transaction Cash ASSETS Accounts Merchandise + Receivable + Inventory LABUTES STOCKHOLDERS' EQUITY Notes Accounts Paid-in Retained Payable + Payable + Capital - Earnings + Revenue - Expenses Equipment

how do i calculate the retained earnings?

Answer 1

Solutions:

Exercise 4-5

	Assets							=	Liabilities			+	Shareholders Equity
	Transaction	+	Accounts	+	Merchandise	+	Equipment		Notes	+	Accounts	+	Paid - in-	+	Retained	+	Revenue	-	Expenses
	Cash		Receivables		Inventory				Payable		Payable		Capital		Earnings
a.	7900												7900
b.	5400								5400
c.	-1600						1600
d.	-1500																		1500
e.	-8800				15800						7000
f.	6000				-4000												6000		4000
g											140								140
h.	-1200				4250						3050
i.	3000		10000		-9200												13000		9200
j.											1900								1900
k.	3500		-3500
l	-4800										-4800

Exercise 2-11

Retained Earnings
Retained Earnings, Jan 01, 2016	305300
Less : Net Loss	-4950
	300350
Less: Dividends	-17000
Retained Earnings, Dec 31, 2016	283350