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ABC Company Has a Balance of $20,340 in Retained Earnings

question 195

Essay

ABC Company has a balance of $20,340 in Retained Earnings as of January 1, 2012. For the year ended December 31, 2012, ABC had a net loss of $6,400. $4,000 was paid in dividends for the year. Prepare the Statement of Retained Earnings for the year ended 2012.


Definitions:

Promoter

A promoter is an individual or company involved in founding or organizing a business or enterprise, typically responsible for raising capital, arranging for necessary legal documents, and setting up operations.

Personally Liable

The legal responsibility of an individual to satisfy debts or obligations from their own assets.

Preincorporation Subscription

An agreement by an investor to purchase stock in a corporation, made before the corporation is legally formed.

Post Incorporation Subscription

Agreements to purchase stock in a company made after the company has been incorporated.

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