Problem 4-6

Below is the Retained Earnings account for the year 2017 for Windsor Corp.

Retained earnings, January 1, 2017				$258,200
Add:
Gain on sale of investments (net of tax)		$41,800
Net income		85,100
Refund on litigation with government, related to the year 2014 (net of tax)		22,200
Recognition of income earned in 2016, but omitted from income statement in that year (net of tax)		26,000		175,100
				433,300
Deduct:
Loss on discontinued operations (net of tax)		35,600
Write-off of goodwill (net of tax)		60,600
Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2017 (net of tax)		23,800
Cash dividends declared		32,600		152,600
Retained earnings, December 31, 2017				$280,700

(a) Prepare a corrected retained earnings statement. Windsor Corp. normally sells investments of the type mentioned above. FIFO inventory was used in 2017 to compute net income. (List items that increase retained earnings first.)

WINDSOR CORP. Retained Earnings Statement December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017
Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues	$
Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues
Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues
Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues
AddLess : Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues
AddLess : Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues
Adjustment for Change in Accounting PrincipleCash Dividends DeclaredCorrection of Error From Prior PeriodExpensesNet Income / (Loss)Retained Earnings, January 1, as AdjustedRetained Earnings, January 1, as ReportedRetained Earnings, December 31RevenuesTotal ExpensesTotal Revenues	$