Blackbeard's Restaurant Began Operations on January 1, 2019, with a Total

question 59

Essay

Blackbeard's Restaurant began operations on January 1, 2019, with a total investment of $100,000 by its stockholders. The restaurant had a net loss its first year of business of $15,000. During 2020 and 2021, the business was profitable with net incomes of $25,000 and $50,000, respectively. The company paid $5,000 per year in dividends to its shareholders in 2020 and 2021.
A)In good form, prepare a statement of retained earnings for the year ended December 31, 2020.
B)How much is total retained earnings on December 31, 2021?
C)Explain the link between the statement of retained earnings and the balance sheet.

• A)In good form, prepare a statement of retained earnings for the year ended December 31, 2020.
• B)How much is total retained earnings on December 31, 2021?
• C)Explain the link between the statement of retained earnings and the balance sheet.

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Definitions:

Flat Affect

A symptom of schizophrenia in which the person shows almost no emotion at all.

Blunted Affect

A significant reduction in the expression of emotions; a symptom often associated with schizophrenia and some mood disorders.

Anhedonia

Loss of the capacity to experience pleasure, a common symptom in major depressive disorder and other psychiatric conditions.

Gustatory Hallucination

A rare type of hallucination that involves tasting something that isn't present, often linked with certain neurological conditions.