Retained Earnings, December 1, 2014 $ 0 Net income for the month 1,800 1,800 Dividends (1,400) $ 400 Retained Earnings, December 31, 2014 Requirement 7 CONSULTING Balance Sheet December 31, 2014 Assets Liabilities Cash $ 16,400 Accounts Payable $ 4,700 Accounts Receivable 1,200 Unearned Revenue 1,400 Office Supplies 900 Total Liabilities $ 6,100 Equipment 1,800 Furniture 4,200 Stockholders’ Equity Common Stock 18,000 Retained Earnings 400 Total Stockholders’ Equity 18,400 Total Liabilities and Stockholders’ Total Assets $ 24,500 $ 24,500 Equity Requirement 8 Debt ratio = Total liabilities / Total assets = $6,100 / $24,500 = 0.25* = 25% * rounded Practice Set P2-44 Requirement 1 Posting Date Accounts and Explanation Ref. Debit Credit Nov. 1 Cash 35,000 8,000 Common Stock 43,000
Retained Earnings, December 1, 2014 $ 0 Net income for the month 1,800 1,800 Dividends (1,400) Retained Earnings, December 31, 2014 $ 400 Requirement 7 CONSULTING Balance Sheet December 31, 2014 Assets Liabilities Cash $ 16,400 Accounts Payable $ 4,700 Accounts Receivable 1,200 Unearned Revenue 1,400 Office Supplies 900 Total Liabilities $ 6,100 Equipment 1,800 Furniture 4,200 Stockholders’ Equity Common Stock 18,000 Retained Earnings 400 Total Stockholders’ Equity 18,400 Total Assets $ 24,500 Total Liabilities and Stockholders’ Equity $ 24,500 Requirement 8 Debt ratio = Total liabilities / Total assets = $6,100 / $24,500 = 0.25* = 25% * rounded Practice Set P2-44 Requirement 1 Date Accounts and Explanation Posting Ref. Debit Credit Nov. 1 Cash 35,000 8,000 Common Stock 43,000