Excerise 1.23

Exercise 1-23 Retained earnings and the closing process As of December 31, 2018, Flowers Company had total assets of $130,000, total liabilities of $50,000, and common stock of $70,000. The company's 2018 income statement contained revenue of $30,000 and expenses of $18,000. The 2018 statement of changes in stockholders' equity stated that $3,000 of dividends were paid to investors. Required a. Determine the before-closing balance in the Retained Earnings account on December 31, 2018. b. Determine the after-closing balance in the Retained Earnings account on December 31, 2018. c. Determine the before-closing balances in the Revenue, Expense, and Dividend accounts on December 31, 2018. d. Determine the after-closing balances in the Revenue, Expense, and Dividend accounts on Decem- ber 31, 2018. e. Explain the difference between common stock and retained earnings. r. On January 1, 2019, Flowers Company raised S30,000 by issuing additional common stock. Im- mediately after the additional capital was raised. Flowers reported total equity of S the stockholders of Flowers in a better financial position than they were on December 31, 2018? 110,000. Are