Correcting the Retained Earnings Account
The retained earnings account for Gotfried Corp. shows the following debits and credits. Indicate all entries required to correct the account. What is the corrected amount of retained earnings?
Account: Retained Earnings
|
Date |
Item |
Debit |
Credit |
Balance |
||
|
Debit |
Credit |
|||||
|
Jan. |
1 |
Balance |
|
|
|
263,200 |
|
(a) |
|
Loss from fire |
2,625 |
|
|
260,575 |
|
(b) |
|
Goodwill impairment |
26,250 |
|
|
234,325 |
|
(c) |
|
Stock dividend |
70,000 |
|
|
164,325 |
|
(d) |
|
Loss on sale of equipment |
24,150 |
|
|
140,175 |
|
(e) |
|
Officers’ compensation related to income of prior periods— |
|
|
|
|
|
|
|
accrual overlooked |
162,750 |
|
22,575 |
|
|
(f) |
|
Loss on retirement of preferred shares at more than issuance price |
35,000 |
|
57,575 |
|
|
(g) |
|
Paid in capital in excess of par |
|
64,750 |
|
7,175 |
|
(h) |
|
Stock subscription defaults |
|
4,235 |
|
11,410 |
|
(i) |
|
Gain on retirement of preferred stock at less than issuance price |
|
12,950 |
|
24,360 |
|
(j) |
|
Gain on early retirement of bonds at less than book value |
|
7,525 |
|
31,885 |
|
(k) |
|
Gain on life insurance policy settlement |
|
9,500 |
|
41,385 |
|
(l) |
|
Correction of prior period error |
|
25,025 |
|
66,410 |