Financial statement information about four different companies is shown below.

Instructions
(a) Determine the missing amounts.
(b) Prepare the retained earnings statement for John Ltd. 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 statement of financial position.

Transcribed Image Text:

Paul Ringo John Ltd George Ltd Ltd. £140,000 100,000 Ltd. January 1, 2017 £ 78,000 50,000 Assets Liabilities Equity E 90,000 50,000 117,000 75,000 54,000 180,000 100,000 10,000 December 31, 2017 Assets Liabilities Equity 79,000 55,000 40,000 80,000 145,000 9 Equity changes in year Additional investment Dividends Total revenues Total expenses 8,000 7,000 350,000 335,000 15,000 10,000 500,000 12,000 390,000 400,000 360,000