At the beginning of April, Owl Corporation has a balance of $12,500 in the Retained Earnings account. During the month of April, Owl had the following external transactions.

1. Issue common stock for cash, $12,000.
2. Provide services to customers on account, $8,000.
3. Provide services to customers in exchange for cash, $2,700.
4. Purchase equipment and pay cash, $7,100.
5. Pay rent for April, $1,300.
6. Pay employee salaries for April, $3,000.
7. Pay dividends to stockholders, $1,750.

Required:
Using the external transactions above, compute the balance of Retained Earnings at April 30. (Decreases should be entered as a negative.)

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abiolataiwo2015 abiolataiwo2015 · Answer 1 · 2021-03-11T01:52:40+01:00

Answer:

$17,150

Explanation:

Computation for the balance of Retained Earnings at April 30.

Retained earnings beginning balance $12,500

Add Provide services to customers on account, $8,000

Add Provide services to customers in exchange for cash $2,700

Less Pay rent for April ($1,300 )

Less Pay employee salaries for April, ($3,000)

Less Pay dividends to stockholders, ($1,750)

Balance of Retained Earnings at April 30 $17,150

Therefore the balance of Retained Earnings at April 30 will be $17,150