Tutorial_Solution_-_Chapter_1__2

Tutorial_Solution_-_Chapter_1__2 - E1-8Retained earnings,...

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Unformatted text preview: E1-8Retained earnings, January 1, 2011$ - Profit for 201136,000Dividends for 2011(15,000)Retained earnings, December 31, 2011$ 21,000Retained earnings, January 1, 2012 $ 21,000Profit for 201245,000Dividends for 2012(20,000)Retained earnings, December 31, 2012$ 46,000P1–1Req. 1NUCLEAR COMPANYSummary Income StatementFor the Year Ended December 31, 2011Total sales revenue (given)$140,000Total expenses, excluding income taxes (given) 89,100Profit before income taxes50,900Income tax expense ($50,900 x 30%)15,270Profit$ 35,630Req. 2NUCLEAR COMPANYStatement of Financial PositionAs at December 31, 2011AssetsCash (given)$ 25,000Accounts receivable (given)12,000Merchandise inventory (given)90,000Equipment, net (given)45,000Total Assets$172,000Liabilities and Shareholders’ EquityLiabilities:Accounts payable (given)$47,370Salary payable (given)2,000Total Liabilities$ 49,370Shareholders' equity:Share capital (given)$87,000Retained earnings*35,630Total shareholders' equity122,630Total liabilities and shareholders' equity$172,000* Ending RE = Beginning RE + Profit – Dividends= $ 0 + $35,630 - $ 0 = $35,630.Because this is the first year of operations the beginning balance of retained earnings is zero.P2–5Req. 1a.Cash (+A).......................................................................................................Cash (+A)....
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This note was uploaded on 12/29/2011 for the course MANAGEMENT MGTB05 taught by Professor Georgequanfun during the Fall '11 term at University of Toronto.

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Tutorial_Solution_-_Chapter_1__2 - E1-8Retained earnings,...

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