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Sunland Corporation began operations on January 1, 2014. During its first 3 years of operations, Sunland reported net income and declared dividends as follows. Net
Sunland Corporation began operations on January 1, 2014. During its first 3 years of operations, Sunland reported net income and declared dividends as follows.
Net income | Dividends declared | |||||
2014 | $47,800 | $ 0 | ||||
2015 | 130,500 | 56,500 | ||||
2016 | 167,700 | 60,000 |
The following information relates to 2017.
Income before income tax | $248,300 | ||
Prior period adjustment: understatement of 2015 depreciation expense (before taxes) | $28,800 | ||
Cumulative decrease in income from change in inventory methods (before taxes) | $43,000 | ||
Dividends declared (of this amount, $28,800 will be paid on January 15, 2018) | $116,500 | ||
Effective tax rate | 40 | % |
Prepare a 2017 retained earnings statement for Sunland Corporation
Assume Sunland Corporation restricted retained earnings in the amount of $76,240 on December 31, 2017. After this action, what would Sunland report as total retained earnings in its December 31, 2017, balance sheet?
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