At the beginning of year 1, a company reported a balance in common stock of $154,000 and a balance in retained earnings of $54,000. during the year, the company issued additional shares of stock for $44,000, earned net income of $34,000, and paid dividends of $10,400. in addition, the company reported balances for the following assets and liabilities on december 31. assets liabilities cash $ 53,000 accounts payable $ 8,600 supplies 11,300 utilities payable 3,200 prepaid rent 26,000 salaries payable 3,900 land 220,000 notes payable 19,000 required: prepare a statement of stockholders’ equity. prepare a balance sheet.

statement of stockholders' equity    

for the year 1  

            Common StockRetained EaringsTotal

Balance Jan 1            154,000  54,000        208,000

Net Earnings                           34,000        34,000

Dividends                           -10,400          -10,400

Stock issued             44,000                       44,000

Balance, Dec 31    198,000  77,600        275,600

Assets                                                        Liability

Cash                 53,000                         Account Payable     8,600

Supplies            11,300                         Utilities Payable       3,200

Prepaid Rent   26,000                         Salaries Payable      3,900

Land               220,000                         Note payable          19,000

                                                              Common Stock     198,000

                                                              Retained Earnings  77,600

Total Assets 310,300                        Total Liab + SE         310,300

Explanation:

For the stockholder statment, we simply post the values of the first part.

Then for the balance sheet: We will work with the numbers given in the the second part.

The payable are the liabilities, the rest are assets.

Finally, we transfer the stock value from the Stockholders statemnet

and check the total for each column

since the options are not listed, when you are working on your budget you should also add water, tv, internet, miscellaneous and your 'fun' money for in your budget. when budgeting, you need to allow for fun money, and mis/accidental money so that you stick to the budget and not go crazy because you feel strapped to the budget.