Using the income statement for Ousel Travel Service shown in Practice Exercise 1-4A, prepare a retained earnings statement for the year ended November 30, 2016. Shane Ousel invested an additional $50,000 in the business in exchange for common stock during the year and cash dividends of $30,000 were paid. Retained earnings as of December 1, 2015, was $566,000.
Answer:
OUSEL TRAVEL SERVICE
Retained Earnings Statement
For the Year Ended November 30, 2016
Retained earnings, December 1, 2015 $566,000
Net income for the year $242,000
Less dividends 30,000
Increase in retained earnings 212,000
Retained earnings, November 30, 2016 $778,000
It might come from typing missing. Common stock should be $150,000 (not $50,000) as linked with the exercise 1-6A :-) :-).
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