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fatement, Lower Portion the beginning of 2019, Cameron Company's retained earnings was $239,400. For 2019, Cameron has calculated its pretax income from continuing operations to be $158,400. During 2019, the following events also occurred: During July, Cameron sold Division M (a component of the company). It has determined that the pretax income from the operations of Division M during 2019 totals $46,800 and that a pretax loss of $47,600 was incurred on the sale of Division M. - Cameron had 28,000 shares of common stock outstanding during all of 2019. It declared and paid a $2 per share cash dividend on this stock. equired: ssuming that all the pretax items are subject to a 30% income tax rate: Complete the lower portion of Cameron's 2019 income statement, beginning with "Pretax Income from Continuing Operations." Round earnings per share computations to two decimal places. CAMERON COMPANY Pretax income from continuing operations Income tax expense ✓ Income from continuing operations ✔ Results from discontinued operations Income from operations of discontinued Division M (net of income taxes) ✔ Loss on sale of Division M (net of income tax credit) ✔ Partial Income Statement For Year Ended December 31, 2019 Net income ✓ Components of Income Income from continuing operations ✔ Results from discontinued operations ✔ Net income Feedback Check My Work ✓ 00 000000001 2. Prepare an accompanying statement of retained earnings for the year ended December 31, 2019. CAMERON COMPANY Statement of Retained Earnings For Year Ended December 31, 2019

fatement, Lower Portion the beginning of 2019, Cameron Company's retained earnings was $239,400. For 2019, Cameron has calculated its pretax income from continuing operations to be $158,400. During 2019, the following events also occurred: During July, Cameron sold Division M (a component of the company). It has determined that the pretax income from the operations of Division M during 2019 totals $46,800 and that a pretax loss of $47,600 was incurred on the sale of Division M. - Cameron had 28,000 shares of common stock outstanding during all of 2019. It declared and paid a $2 per share cash dividend on this stock. equired: ssuming that all the pretax items are subject to a 30% income tax rate: Complete the lower portion of Cameron's 2019 income statement, beginning with "Pretax Income from Continuing Operations." Round earnings per share computations to two decimal places. CAMERON COMPANY Pretax income from continuing operations Income tax expense ✓ Income from continuing operations ✔ Results from discontinued operations Income from operations of discontinued Division M (net of income taxes) ✔ Loss on sale of Division M (net of income tax credit) ✔ Partial Income Statement For Year Ended December 31, 2019 Net income ✓ Components of Income Income from continuing operations ✔ Results from discontinued operations ✔ Net income Feedback Check My Work ✓ 00 000000001 2. Prepare an accompanying statement of retained earnings for the year ended December 31, 2019. CAMERON COMPANY Statement of Retained Earnings For Year Ended December 31, 2019

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter5: The Income Statement And The Statement Of Cash Flows
Section: Chapter Questions
Problem 2P
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2. Prepare an accompanying statement of retained earnings for the year ended December 31, 2019. CAMERON COMPANY Statement of Retained Earnings For Year Ended December 31, 2019 ✓ Retained earnings, 1/1/2019 Add: Net income for 2019- Less: Cash dividends ✓ Retained earnings, 12/31/2019 ✓ Although not a required financial statement, whenever a corporation issues an income statement and a balance sheet, it may include a schedule that reconciles the beginning retained earnings balance with the ending retained earnings balance. Some smaller companies report this schedule as a separate financial statement, called the statement of retained earnings. More often, companies report this reconciliation within the statement of shareholders' equity. Example of a reconciliation of retained earnings: Banner Corporation Reconciliation of Retained Earnings For the Year Ended December 31, 2019 Retained earnings, January 1, 2019 Add: Prior period adjustment, correction of understatement of 2012 ending inventory (net of $1,500 income taxes) Adjusted retained earnings, January 1, 2019 Add: Net income Less: Cash dividends declared, $0.50 per share Retained earnings, December 31, 2019 $68,150 3,500 $71,650 9,450 (2,500) $78,600
Transcribed Image Text:2. Prepare an accompanying statement of retained earnings for the year ended December 31, 2019. CAMERON COMPANY Statement of Retained Earnings For Year Ended December 31, 2019 ✓ Retained earnings, 1/1/2019 Add: Net income for 2019- Less: Cash dividends ✓ Retained earnings, 12/31/2019 ✓ Although not a required financial statement, whenever a corporation issues an income statement and a balance sheet, it may include a schedule that reconciles the beginning retained earnings balance with the ending retained earnings balance. Some smaller companies report this schedule as a separate financial statement, called the statement of retained earnings. More often, companies report this reconciliation within the statement of shareholders' equity. Example of a reconciliation of retained earnings: Banner Corporation Reconciliation of Retained Earnings For the Year Ended December 31, 2019 Retained earnings, January 1, 2019 Add: Prior period adjustment, correction of understatement of 2012 ending inventory (net of $1,500 income taxes) Adjusted retained earnings, January 1, 2019 Add: Net income Less: Cash dividends declared, $0.50 per share Retained earnings, December 31, 2019 $68,150 3,500 $71,650 9,450 (2,500) $78,600
Income Statement, Lower Portion At the beginning of 2019, Cameron Company's retained earnings was $239,400. For 2019, Cameron has calculated its pretax income from continuing operations to be $158,400. During 2019, the following events also occurred: 1. During July, Cameron sold Division M (a component of the company). It has determined that the pretax income from the operations of Division M during 2019 totals $46,800 and that a pretax loss of $47,600 was incurred on the sale of Division M. 2. Cameron had 28,000 shares of common stock outstanding during all of 2019. It declared and paid a $2 per share cash dividend on this stock. Required: Assuming that all the pretax items are subject to a 30% income tax rate: 1. Complete the lower portion of Cameron's 2019 income statement, beginning with "Pretax Income from Continuing Operations." Round earnings per share computations to two decimal places. CAMERON COMPANY Partial Income Statement For Year Ended December 31, 2019 Pretax income from continuing operations Income tax expense ✓ Income from continuing operations ✔ Results from discontinued operations Income from operations of discontinued Division M (net of income taxes) ✓ Loss on sale of Division M (net of income tax credit) ✓✔ Net income ✓ Components of Income. Income from continuing operations Results from discontinued operations Net income ✓ ✓ 00 Statement of Retained Earnings For Year Ended December 31, 2019 1000 100 000 2. Prepare an accompanying statement of retained earnings for the year ended December 31, 2019. CAMERON COMPANY
Transcribed Image Text:Income Statement, Lower Portion At the beginning of 2019, Cameron Company's retained earnings was $239,400. For 2019, Cameron has calculated its pretax income from continuing operations to be $158,400. During 2019, the following events also occurred: 1. During July, Cameron sold Division M (a component of the company). It has determined that the pretax income from the operations of Division M during 2019 totals $46,800 and that a pretax loss of $47,600 was incurred on the sale of Division M. 2. Cameron had 28,000 shares of common stock outstanding during all of 2019. It declared and paid a $2 per share cash dividend on this stock. Required: Assuming that all the pretax items are subject to a 30% income tax rate: 1. Complete the lower portion of Cameron's 2019 income statement, beginning with "Pretax Income from Continuing Operations." Round earnings per share computations to two decimal places. CAMERON COMPANY Partial Income Statement For Year Ended December 31, 2019 Pretax income from continuing operations Income tax expense ✓ Income from continuing operations ✔ Results from discontinued operations Income from operations of discontinued Division M (net of income taxes) ✓ Loss on sale of Division M (net of income tax credit) ✓✔ Net income ✓ Components of Income. Income from continuing operations Results from discontinued operations Net income ✓ ✓ 00 Statement of Retained Earnings For Year Ended December 31, 2019 1000 100 000 2. Prepare an accompanying statement of retained earnings for the year ended December 31, 2019. CAMERON COMPANY
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