Question

Sheffield Co. reports the following information for 2020: sales revenue $777,100, cost of goods sold $520,000, operating expenses $89,200, and an unrealized holding loss on available-for-sale debt securities for 2020 of $53,700. It declared and paid a cash dividend of $11,670 in 2020. Sheffield Co. has January 1, 2020, balances in common stock $360,400; accumulated other comprehensive income $86,000; and retained earnings $92,040. It issued no stock during 2020. (Ignore income taxes.) Prepare a statement of stockholders’ equity.

Answer 1

Answer:

Explanation:

The statement of stockholder's equity comprises common stock, retained earnings, comprehensive income, and other comprehensive income The ending balance after adjustment shown in the attached spreadsheet.  

The ending balance of retained earnings is computed by:

= Beginning retained earning balance + net income - dividend paid

where,  

Net income = Sales revenue - the cost of goods sold - operating expenses

                   = $777,100 - $520,000 - $89,200

                   = $167,900

The preparation of the statement of stockholders’ equity is presented in the spreadsheet. Kindly find the attachment below: