Petras Company Engaged in the Following Transactions During 2012, Its

question 194

Multiple Choice

Petras Company engaged in the following transactions during 2012, its first year in 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 $600 of revenues.
4) Paid expenses of $250.
5) Paid a $50 dividend.
During 2013, Petras 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.
4) Incurred expenses of $360.
5) Paid dividends of $100.
The amount of retained earnings on Petras's 2013 balance sheet is

• A) $915.
• B) $890.
• C) $590.
• D) $690.

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Definitions:

Common Carriers

Entities that provide transportation services to the general public for a fee.

Absolutely-Strictly-Liable

Refers to a legal standard where a party is held responsible for damages or harm without the need to prove negligence or fault.

Bailed Goods

Refers to items that are in the possession of someone other than the owner, under a bailment agreement, where the recipient (bailee) is responsible for the care and return of the goods.

Property Owners

Individuals or entities that hold legal title to land or buildings, granting them certain rights over the use and management of the property.