Question

At the beginning of April, Owl Corporation has a balance of $12,000 in the Retained Earnings account. During the month of April, Owl had the following external transactions.
1. Issue common stock for cash, $8,000.
2. Provide services to customers on account, $6,100.
3. Provide services to customers in exchange for cash, $2,400.
4. Purchase equipment and pay cash, $5,600.
5. Pay rent for April, $1,000.
6. Pay workers' salaries for April, $2,500.
7. Pay dividends to stockholders, $1,100.

Using the external transactions above, compute the balance of Retained Earnings at April 30 ...?

Answer 1

common stock: 8000 cash: 8000 5600 2400 1000 2500 1100 ----------- 10400 10200 +200 equip: 5600 notes recv: 6100 revenue: 6100 2400 ------- 8500 rent: 1000 wages: 2500 dividends: 1100 ------- 4600 ------------------------------- 8500 -4600 ------ 3900 - gross profits