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The Retained Earnings account of Merry Exams Morty Company shows the following debits and credits for the year 2020: RETAINED EARNINGS Date Description Debit Credit

The Retained Earnings account of Merry Exams Morty Company shows the following debits and credits for the year 2020:

RETAINED EARNINGS

Date

Description

Debit

Credit

Balance

Jan. 1

Balance

726,400

a)

Loss from fire

5,250

721,150

b)

Write-off of goodwill

52,500

668,650

c)

Stock dividends distributed

140,000

528,650

d)

Loss on sale of equipment

48,300

480,350

e)

Officers’ compensation related to the income of prior periods – accrual overlooked

325,500

154,850

f)

Loss on retirement of preferred shares at more than issue price

70,000

84,850

g)

Paid in capital in excess of par

129,500

214,350

h)

Stock issuance expenses (related to letter g)

10,000

204,350

i)

Stock subscriptions defaults

8,470

212,820

j)

Gain on retirement of preferred stock at less than issue price

25,900

238,720

k)

Gain on early retirement of bonds

15,050

253,770

l)

Gain on life insurance policy settlement

10,500

264,270

m)

Correction of prior period error

50,050

314,320

n)

Effect of change in accounting policy – from FIFO to weighted average

100,000

414,320

o)

Dividends payable

25,000

389,320

p)

Loss on sale of treasury stock

20,000

369,320

q)

Proceeds from sale of donated stock

40,000

409,320

r)

Appraisal increase in land

250,000

659,320

s)

Appropriated for property acquisition

100,000

559,320

The entry to correct the Retained Earnings account will include:

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