The adjusted trial balance for Aster Automobiles Inc. at December 31, 2021, is presented below. Aster?s income tax rate is 25% and journal entries for income tax expense have not yet been prepared. There were no common share transactions during the year.

Instructions

a. Prepare a statement of comprehensive income on an all-inclusive basis. (Ignore earnings per share.)

b. Prepare a statement of changes in shareholders? equity for the year.

c. Prepare the shareholders? equity section of the balance sheet at December 31, 2021.

Taking It Further

Why is it important to report the changes that took place in shareholders? equity during the year?

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ASTER AUTOMOBILES INC. Adjusted Trial Balance December 31, 2021 Debit Credit $ 44,620 Accounts payable Accounts receivable Accumulated depreciation-equipment Accumulated depreciation-building Accumulated other comprehensive income (loss)–January 1, 2021 Advertising expense Building Cash Cash dividends-common Common shares (10,000 shares issued) Contributed surplus-reacquisition of common shares Cost of goods sold Depreciation expense Dividends payable Equipment Gain on sale of equipment Income tax expense Income tax payable $ 25,430 14,300 95,500 5,860 375,000 170,000 5,000 245,000 5,500 356,000 19,000 900 85,000 800 Interest expense Merchandise inventory Office expense Other comprehensive income-holding loss on equity investment (before income tax) 2,650 73,460 9,000 3,400 Retained earnings–January 1, 2021 53,180 Sales 670,000 $1,129,800 $1,129,800