Financial statement information about four different companies is shown below.

Instructions
(a) Determine the missing amounts. (Hint: For example, to solve for (a), Assets – Liabilities = Stockholders' Equity = $28,000.)
(b) Prepare the retained earnings statement for John Company. Assume beginning retained earnings was $0.
(c) Write a memorandum explaining the sequence for preparing financial statements and the interrelationship of the retained earnings statement to the income statement and balancesheet.

Transcribed Image Text:

ohn Paul Ringo Company Company Company Company $150,000 100,000 January1, 2014 $ 78,000 90,000 50,000 117,000 Liabilities Stockholders' equity 75,000 54,000 180,000 100,000 10,000 December 31, 2014 Liabilities Stockholders' equity 55,000 40,000 79,000 80,000 145,000 Stockholders' equity changes in year Additional investment Dividends Total revenues Total expenses 15,000 10,000 500,000 8,000 10,000 12,000 350,000 390,000 335,000 400,000 360,000