Question
Pratt Corp. started the Year 2 accounting period with total assets of $33,000 cash, $13,500 of liabilities, and $18,000 of retained earnings. During the Year
Pratt Corp. started the Year 2 accounting period with total assets of $33,000 cash, $13,500 of liabilities, and $18,000 of retained earnings. During the Year 2 accounting period, the Retained Earnings account increased by $17,550. The bookkeeper reported that Pratt paid cash expenses of $32,500 and paid a $3,300 cash dividend to stockholders, but she could not find a record of the amount of cash revenue that Pratt received for performing services. Pratt also paid $7,500 cash to reduce the liability owed to a bank, and the business acquired $7,400 of additional cash from the issue of common stock. Assume all transactions are cash transactions.
a. Prepare the Year 2 income statement.
b. Prepare the Year 2 statement of changes in stockholders equity
c. Prepare the Year 2 balance sheet.
e. Determine the percentage of total assets that were provided by creditors, investors, and earnings. (Round your answers to 2 decimal places.)
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