Final Critical Thinking-1

Final Critical Thinking-1 - Part I Accrual Basis Revenue...

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Part I Accrual Basis Revenue, Year I 490,000 Accrual Basis Expenses, Year I 202,000
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Part II Operating income 175,000 Income from continuing operations 93,000 Net Income 45,000 Part III: Compute the ending balance of Retained Earnings at the end of Year 1, 2 and 3 (taking into account the accounting error and the dividends paid in Year 2). Dividends for Year 3 were $ 20,000. Retained Earnings Year 1 717,000 Retained Earnings Year 2 703,000 Retained Earnings Year 3 728,000
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Part IV Your memo should clearly state how Tarrytown should deal with the discontinued operations for Year 3 and Year 4. Complete your memo in the next page.
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DOUGLAS AND DAUGHTERS (DOUGLAS) 3800 MONTROSE BOULEVBARD HOUSTON, TX 77006 USA TO: ALBANY CONSULTANT, Client FROM: CPA DATE: December,13th 2010 RE: Disposal of Best's Asset Dear Tara, We understand that you are confused about the way you need to work with the disposal of 'TARRYTOWN'.The disposal of Tarrytown meets the criteria to be treated as a discontinued operation. The income statement of a corporation includes the same types of revenues and expenses as companies organized as sole proprietors and partnerships with one difference. A corporation is a legal entity and therefore, it must pay taxes. The expense
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This note was uploaded on 05/10/2011 for the course WEE er taught by Professor Ews during the Spring '11 term at University of Houston.

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Final Critical Thinking-1 - Part I Accrual Basis Revenue...

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