Packard Company Engaged in the Following Transactions During Year 1

question 69

Multiple Choice

Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)
1) Acquired $950 cash from the issue of common stock.
2) Borrowed $420 from a bank.
3) Earned $650 of revenues cash.
4) Paid expenses of $250.
"5) Paid a $50 dividend.
During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.) "
1) Issued an additional $325 of common stock.
2) Repaid $220 of its debt to the bank.
3) Earned revenues of $750 cash.
4) Incurred expenses of $360.
"5) Paid dividends of $100.
The amount of retained earnings on Packard's Year 2 balance sheet is:"

• A) $640.
• B) $800.
• C) $290.
• D) $740.

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Definitions:

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