Question

Return to que Exercise 18-17 (Algo) Transactions affecting retained earnings (L018-6, 18-7] 93 Shown below in T-account format are the changes affecting the retained earnings of Brenner-Jude Corporation during 2021. At January 1, 2021, the corporation had outstanding 108 million common shares, 51 par per share. Retained Earnings (5 in millions) Beginning balance Retirement of 8 million common shares for $22 million Net Income for the year Declaration and payment of a 50.36 per share cash dividend Declaration and distribution of a 5% stock dividend 100 Ending balance 5 82 36 26 Required: 1. From the information provided by the account changes, you should be able to recreate the transactions that affected Brenner Jude's retained earnings during 2021. Prepare the journal entries that Brenner Jude must have recorded during the year for these transactions. (Hint in lieu of revenues and expenses, use an account titled "Income summary to close net income or net loss) 2. Prepare a statement of retained earnings for Brenner Jude for the year ended 2021

Answer 1

BRENNER JUDE CORPORATION Statement of Retained Earnings FOR THE YEAR ENDED DECEMBER 31, 2021 ($ in millions) Balance at January 1 Add: Net Income $93 $82 $175 Deductions: - Retirement of 8 million common shares - Cash Dividend - Stock Dividend Balance at December 31 ($5) ($36) ($26) $108

I hope this clear your doubt.

Feel free to comment if you still have any query or need something else. I'll help asap.

Do give a thumbs up if you find this helpful.