ving applies to the questions dis Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $56,000 cash to start the business and received 4,000 shares of stock. The store completed its first year of operations on December 31, 2020. On that date, the following financial items for the year were determined: cash on hand and in the bank, $51,500; amounts due from customers from sales of books, $28,600; equipment, $55,000; amounts owed to publishers for books purchased, $9,100; one-year notes payable to a local bank for $5,400. No dividends were declared or paid to the stockholders during the year. Te Assuming that Reader Direct generates net income of $6,500 and pays dividends of $3,700 in 2021, what would be the ending Potained Earnings balance at Docomber 21, 20212
ving applies to the questions dis Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $56,000 cash to start the business and received 4,000 shares of stock. The store completed its first year of operations on December 31, 2020. On that date, the following financial items for the year were determined: cash on hand and in the bank, $51,500; amounts due from customers from sales of books, $28,600; equipment, $55,000; amounts owed to publishers for books purchased, $9,100; one-year notes payable to a local bank for $5,400. No dividends were declared or paid to the stockholders during the year. Te Assuming that Reader Direct generates net income of $6,500 and pays dividends of $3,700 in 2021, what would be the ending Potained Earnings balance at Docomber 21, 20212
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information
[The following information applies to the questions displayed below.]
Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $56,000 cash to start the
business and received 4,000 shares of stock. The store completed its first year of operations on December 31, 2020. On
that date, the following financial items for the year were determined: cash on hand and in the bank, $51,500; amounts due
from customers from sales of books, $28,600; equipment, $55,000; amounts owed to publishers for books purchased,
$9,100; one-year notes payable to a local bank for $5,400. No dividends were declared or paid to the stockholders during
the year.
4. Assuming that Reader Direct generates net income of $6,500 and pays dividends of $3,700 in 2021, what would be the ending
Retained Earnings balance at December 31, 2021?
=
+](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7c7d9954-a9ae-4568-87fa-e9bd1521b34d%2F6f6e4835-3f11-4193-b4e9-efc29694fb09%2F512cnw_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
[The following information applies to the questions displayed below.]
Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $56,000 cash to start the
business and received 4,000 shares of stock. The store completed its first year of operations on December 31, 2020. On
that date, the following financial items for the year were determined: cash on hand and in the bank, $51,500; amounts due
from customers from sales of books, $28,600; equipment, $55,000; amounts owed to publishers for books purchased,
$9,100; one-year notes payable to a local bank for $5,400. No dividends were declared or paid to the stockholders during
the year.
4. Assuming that Reader Direct generates net income of $6,500 and pays dividends of $3,700 in 2021, what would be the ending
Retained Earnings balance at December 31, 2021?
=
+
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