explain why each is incorrect/correct 6. On December 31st, 2014, Paper Plane Company had a debit balance
Fantastic news! We've Found the answer you've been seeking!
Question:
explain why each is incorrect/correct
Transcribed Image Text:
6. On December 31st, 2014, Paper Plane Company had a debit balance of $2,000 in Retained Earnings. On December 31st, 2015, the Retained Earnings account had a credit balance of $1,000. Which of the following could have happened during 2015? A. Paper Plane had a net loss of $3,000 and paid no dividends. B. Paper Plane had a net loss of $1,500 but raised $4,500 capital by issuing additional common stock C. Paper Plane had net income of $1,000, and this was the only thing that impacted retained earnings. Paper Plane had a net income of $3,500 and paid $500 in dividends This is an impossible situation because Retained Earnings account can never have a debit balance D. E. 6. On December 31st, 2014, Paper Plane Company had a debit balance of $2,000 in Retained Earnings. On December 31st, 2015, the Retained Earnings account had a credit balance of $1,000. Which of the following could have happened during 2015? A. Paper Plane had a net loss of $3,000 and paid no dividends. B. Paper Plane had a net loss of $1,500 but raised $4,500 capital by issuing additional common stock C. Paper Plane had net income of $1,000, and this was the only thing that impacted retained earnings. Paper Plane had a net income of $3,500 and paid $500 in dividends This is an impossible situation because Retained Earnings account can never have a debit balance D. E.
Expert Answer:
Answer rating: 100% (QA)
The detailed answer for the above question is provided below A Paper Plane had a net loss of 3000 an... View the full answer
Related Book For
Accounting Tools for Business Decision Making
ISBN: 978-1118128169
5th edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Posted Date:
Students also viewed these accounting questions
-
Explain why each is likely to occur.
-
Correct the following sentences and identify why they are incorrect 1. He statute requires the witnesses to be present when the testator signs the will, and the witnesses must be in the same room...
-
(1) Are these myths? Explain why each is either true or a myth. (2) Is it true that: You Can Win Customers Just by Lowering Your Prices? Explain (3) Would you say that you should never Form a...
-
Find the distance between the given pairs of points. (32, 18) and (50, 8)
-
Doreen Company is preparing its cash budget for the month of May. The following information is available concerning its accounts receivable: Actual credit sales for March .................$120,000...
-
Management tends to focus on residual risk instead of inherent risk. Why do you think this is so? Why should internal auditors consider both inherent risk and residual risk when planning an assurance...
-
In March 1979 one of the worst nuclear accidents in the United States occurred at the Three Mile Island nuclear plant in Pennsylvania. One of the nuclear reactors (Unit 2) at the plant had a partial...
-
The City of Manhattan, Kansas, prepares an annual Budget Book, a comprehensive document that includes a citywide budget, as well as departmental budgets. The city has received the GFOA Distinguished...
-
Journalize the employer's payroll tax expense for February 28. Notice that this journal entry is similar to the one on January 31. Use the February FICA amounts. Notice that Amy Hamilton reaches the...
-
Research the Internet for recent litigation, censures, and fines involving national public accounting firms. Examples of litigation cases against national public accounting firms include fines by...
-
What are one of the main contributors to workplace violence is and what can be done to reduce incidents? Explain
-
Explain the two characteristics of the Cobb-Douglas production function that make it particularly useful to macroeconomists.
-
View the recent tweets of two or three business leaders (you might consider looking for accounts of business leaders youre interested in, or you could find lists of business leaders accounts such as...
-
The Sorry Charlie Tuna Company produces canned tuna fish. The true mean weight of a can of tuna is 6 oz with a standard deviation of 1 oz. Assume the population is normally distributed, and suppose...
-
In Freeport High School, 40 % of the seniors who are eligible to vote indicated that they plan to vote in the upcoming election. What is the probability of selecting a random sample of 400 students...
-
Suppose the mean amount of money spent by students on textbooks each semester is $175 with a standard deviation of $25. Assume that the population is normally distributed. Suppose you take a random...
-
What is the total present value of $1,000 received at the end of year 1, $1,200 received at the end of year 2, and $1,300 received at the end of year 3, assuming an opportunity cost of 7 percent?
-
Pedro Bourbone is the founder and owner of a highly successful small business and, over the past several years, has accumulated a significant amount of personal wealth. His portfolio of stocks and...
-
Suppose Canwest Global Communications Corp. reported net cash used by operating activities of $104,539,000 and sales revenue of $2,867,459,000 during 2014. Cash spent on plant asset additions during...
-
PCB Corporation manufactures a single product. Monthly production costs incurred in the manufacturing process are shown below for the production of 3,000 units. The utilities and maintenance costs...
-
Season tickets for the Wildcats are priced at $320 and include 16 games. Revenue is recognized after each game is played. When the season began, the amount credited to Unearned Ticket Revenue was...
-
Identify from Cresseys research the six situational categories that cause nonshareable problems.
-
A scientist has two bucketsone holds 4 gallons and the other holds 5 gallonsas well as an unlimited water supply. By using nothing but the buckets and water, how can you accurately measure 3 gallons...
-
Which of the following is true with regard to Cresseys theory of crime causation? 1. For a fraud to occur, only one of the fraud triangle attributes (perceived pressure, perceived opportunity, or...
Study smarter with the SolutionInn App