Question

Retained Earnings Statement Financial information related to Healthy Products Company for the month ended November 30, 2018, is as follows: Net income for November $93,500 Cash dividends paid during November 7,000 Retained earnings, November 1, 2018 2,940,000 a. Prepare a retained earnings statement for the month ended November 30, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. Healthy Products Company Retained Earnings Statement For the Month Ended November 30, 2018 $ $ $ b. Why is the retained earnings statement prepared before the November 30, 2018, balance sheet

Answer 1

Answer:

Explanation:

a. The preparation of the retained earnings statement for the month ended November 30, 2018 is presented below:

                                   Healthy Products Company

                                 Retained Earning statement

                        For the month ended November 30, 2018

Beginning balance of retained earning $2,940,000

Add: Net income $93,500

Less: Cash Dividend paid -$7,000

Ending balance of retained earning        $3,026,500

b. As the trial balance, income statement, and the statement of the stockholder equity that comprise of common stock and the retained earning is prepared before preparing the balance sheet. Because the amounts are required to preparing the balance sheet