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Below is the Retained Earnings account for the year 2017 for Bramble Corp. Retained earnings, January 1, 2017 $265,330 Add: Gain on sale of investments
Below is the Retained Earnings account for the year 2017 for Bramble Corp.
Retained earnings, January 1, 2017 | $265,330 | |||
Add: | ||||
Gain on sale of investments (net of tax) | $48,930 | |||
Net income | 92,230 | |||
Refund on litigation with government, related to the year 2014 (net of tax) | 29,330 | |||
Recognition of income earned in 2016, but omitted from income statement in that year (net of tax) | 33,130 | 203,620 | ||
468,950 | ||||
Deduct: | ||||
Loss on discontinued operations (net of tax) | 42,730 | |||
Write-off of goodwill (net of tax) | 67,730 | |||
Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2017 (net of tax) | 30,930 | |||
Cash dividends declared | 39,730 | 181,120 | ||
Retained earnings, December 31, 2017 | $287,830 |
(a) Prepare a corrected retained earnings statement. Bramble Corp. normally sells investments of the type mentioned above. FIFO inventory was used in 2017 to compute net income.
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