Question

The following information is from Amos Company for the year ended December 31, 2019. Retained earnings at December 31, 2018 (before discovery of error), $858,000. Cash dividends declared and paid during the year, $18,000. Two years ago, it forgot to record depreciation expense of $42,600 (net of tax benefit). The company earned $220,000 in net income this year. Prepare a statement of retained earnings for Amos Company. (Amounts to be deducted should be indicated with a minus sign.)

Answer 1

$1,017,400

Step-by-step explanation:

Particulars Amount

Retained earnings December 31st, 2018 $858,000

Prior period adjustment

Depreciation expense error -$42,600

Adjusted retained earnings December 31st, 2018 $815,400

Add: Net income $220,000

Less: Dividend -$18,000

Retained earnings December 31st, 2019 $1,017,400