Question

In addition, the balance of common stock at the beginning of the year was $550,000, and the balance of retained earnings was $46,000. During the year, the company issued additional shares of common stock for $32,000 and paid dividends of $24,000. Required: Prepare an income statement. Prepare a statement of stockholders’ equity.

Answer 1

Answer: Income Statement:

Revenue: _________

Expenses: _________

Net Income: _________

Statement of Stockholders' Equity:

Beginning Balance:

Common Stock: $550,000

Retained Earnings: $46,000

Total: $596,000

Additions:

Common Stock: $32,000

Total: $628,000

Deductions:

Dividends: $24,000

Total: $604,000

Ending Balance:

Common Stock: $550,000

Retained Earnings: $50,000

Total: $600,000

Note: I've left the Revenue, Expenses and Net Income section in the income statement blank as it is not provided in the question. It is also important to note that these are just examples and the numbers may not match with the actual financial statement.

Explanation: