Below is the Retained Earnings account for the year 2020 for Concord Corp. Retained earnings, January 1, 2020 Add: Gain on sale of investments (net of tax) Net income Refund on litigation with government, related to the year 2017 (net of tax) Recognition of income earned in 2019, but omitted from income statement in that year (net of tax) Deduct: Loss on discontinued operations (net of tax) Write-off of goodwill (net of tax) Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2020 (net of tax) Cash dividends declared Retained earnings, December 31, 2020 $43,510 86,810 23,910 CONCORD CORP. Retained Earnings Statement 27,710 37,310 62,310 25,510 34,310 $259,910 181,940 441,850 159,440 $282,410 (a) Prepare a corrected retained earnings statement. Concord Corp. normally sells investments of the type mentioned above. FIFC inventory was used in 2020 to compute net income. (List items that increase adjusted retained earnings first)

Below is the Retained Earnings account for the year 2020 for Concord Corp. Retained earnings, January 1, 2020 Add: Gain on sale of investments (net of tax) Net income Refund on litigation with government, related to the year 2017 (net of tax) Recognition of income earned in 2019, but omitted from income statement in that year (net of tax) Deduct: Loss on discontinued operations (net of tax) Write-off of goodwill (net of tax) Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2020 (net of tax) Cash dividends declared Retained earnings, December 31, 2020 $43,510 86,810 23,910 CONCORD CORP. Retained Earnings Statement 27,710 37,310 62,310 25,510 34,310 $259,910 181,940 441,850 159,440 $282,410 (a) Prepare a corrected retained earnings statement. Concord Corp. normally sells investments of the type mentioned above. FIFC inventory was used in 2020 to compute net income. (List items that increase adjusted retained earnings first)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

100%

Below is the Retained Earnings account for the year 2020 for Concord Corp.
Retained earnings, January 1, 2020
Add:
Gain on sale of investments (net of tax)
Net income
Refund on litigation with government, related to the year 2017 (net of tax)
Recognition of income earned in 2019, but omitted from income
statement in that year (net of tax)
Deduct:
Loss on discontinued operations (net of tax)
Write-off of goodwill (net of tax)
Cumulative effect on income of prior years in changing from
LIFO to FIFO inventory valuation in 2020 (net of tax)
Cash dividends declared
Retained earnings, December 31, 2020
$43,510
86,810
23,910
CONCORD CORP.
Retained Earnings Statement
27,710
37,310
62,310
25,510
34,310
$259,910
181,940
441,850
159,440
$282,410
(a) Prepare a corrected retained earnings statement. Concord Corp. normally sells investments of the type mentioned above. FIFC
inventory was used in 2020 to compute net income. (List items that increase adjusted retained earnings first.)

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