Glenn Corporation had the following list of account balances

Glenn Corporation had the following list of account balances for the year ended December 31, 2017 $1,350,000 Cash Net Sales Accounts Receivable Equipment Accounts Payable Accumulated Depreciation Inventories Income Taxes Payable $400,000 380,000 250,000 20,000 750,000 10,000 71,000 120,000 Operating Expenses 300,000 Common Stock 100,000 Interest Income 30,000 Cost of Goods Sold 30,000 Prepaid Rent 40,000 Income Taxes Expense Notes Payable Dividends Interest Expense 200,000 Retained Earnings 10,000 January 1, 2017 85,000 4,000 Required 1. Calculate net income for the year ending December 31, 2017 2. Calculate ending retained earnings for the year ending December 31, 2017 3. Calculate current assets on December 31, 2017 4. Calculate total stockholde 169 ord 1, 2017

Solution

Net income = Net sales - Cost of goods sold - Operating expenses - Interest expense - Income tax expense + Interest income

= 1350000 - 750000 - 380000 - 4000 - 71000 + 20000

= 165000

Ending retained earnings = Opening retained earnings + Net income - Dividends

= 85000 + 165000 - 10000 = 240000

Current assets = Accounts receivable + Inventory + Cash + Prepaid rent = 120000 + 30000 + 400000 + 10000

= 560000

Total stock holder equity = Common stock + Retained earnings = 250000 + 240000 = 490000