On December 31, 2018, Immediately After All the Adjustments Were

question 106

Multiple Choice

On December 31, 2018, immediately after all the adjustments were made to Kingman Corp's accounting records for the 2018 fiscal year, but before the books were closed, the retained earnings account reflected a balance of $60,000. Kingman Corp's net income for 2018 was $12,000. Kingman paid no dividends during 2018. On the balance sheet for January 1, 2019, the balance in the retained earnings account will be

• A)$0
• B)$72,000
• C)$38,000
• D)$60,000

Learn the financial consequences of ownership interest transactions among partners and third parties.

Understand how the admission of a new partner by contributing assets or buying an interest affects the partnership's owners' equity.

Understand the process and implications of admitting a new partner into a partnership.

Learn the calculation and distribution of capital balances following the admission of a new partner.

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Definitions:

Extraordinary Item

A significant transaction or event that is both unusual and infrequent, no longer recognized in GAAP financial statements but was distinguished as having a major impact on a company's financial health.

Cost of Goods Sold

The Cost of Goods Sold (COGS) represents the direct expenses related to the production of goods sold by a company, including material and labor costs.

Purchase Discounts

A reduction in the price paid for goods or services, often provided by the seller to encourage prompt payment.

Freight-In

The cost associated with transporting goods to a company's location, which is typically included in the inventory cost of the purchased goods.