my turn Posts: 2, Reputation: 1 New Member #1 Sep 4, 2009, 01:25 PM
How to calculate total revenue and dividends
I am stuck on one question with two parts. I have tried to work on this for several hours and attempted to look up and Google for any help.

A. I have to find the total revenue of a business with only summaries of data from the balance sheet, income statement and retained earnings statement.

I was given the total assets, total liabilities, dividends and total expenses. How in the world does one calculate total revenue from this limited information?

Part 2.

Same scenario, of the information provided to me as listed in part A, but this time I am given the total assets, total liablilties, stockholders' equity, total revenues and total expenses... and I have to determine the dividends. No info given on retained earnings.

 ArcSine Posts: 969, Reputation: 106 Senior Member #2 Sep 4, 2009, 03:19 PM
Use one or both of the following. With respect to any period (month, quarter, year):

Revenue less Expenses = Net Income (or Net Loss, if Expenses > Revenue).

Beginning Retained Earnings, plus Net Income (or less Net Loss), less Dividends, = Ending Retained Earnings.

As long as you have all but one of the variables in either equation, you can easily solve for the one unknown.

Try plugging your known values into these equations to determine the missing pieces. You may have to work out the equations in sequence, with the answer to one equation giving you an additional value to pop into the other one. Give that a spin and see where it leads.

There are some other equations that you might need to use, such as

Beginning Total Equity plus / minus Net Income / Loss, plus Additional Shareholder Investment, less Dividends, = Ending Total Equity. But based on the limited info in your post, I can't tell for sure if this one or other similar equations will play a role. Post back if you need more.
 my turn Posts: 2, Reputation: 1 New Member #3 Sep 4, 2009, 03:44 PM
thanks for your help... from the second equation, I was able to find the dividends in the second part by determining the net income, subtracting the beginning total stockholders' equity from the end total stockholders' equity and then subtracting the net income from that to get the dividends... however I still have no clue how to determine the total revenue in the following problem without the retained earnings. I have to find the total ending revenues... I was able to calculate d and e, but f has me completely stumped. Please help.

The summaries of data from the balance sheet, income statement, and retained earnings statement for Holden Enterprises, are presented below for 2010.
Determine the missing amounts. Assume all changes in stockholders' equity are due to changes in retained earnings.

Holden Enterprises
Beginning of year
Total assets \$127,983
Total liabilities (d)
Total stockholders' equity 88,235
End of year
Total assets 177,010
Total liabilities 50,091
Total stockholders' equity (e)
Changes during year in retained earnings
Dividends 5,091
Total revenues (f)
Total expenses 76,787
 morgaine300 Posts: 6,561, Reputation: 276 Uber Member #4 Sep 4, 2009, 06:53 PM

It makes it a whole lot easier if you include the complete information. Like showing what you have at the bottom of your second post - that would have been nice to see, so we can see exactly what you've got.

At any rate, use your accounting equation and see if you can get it from there.

I've seen several posts along these same lines recently. Do you care to say which text (and author) you are using - I'd be curious to see the whole original problem.
 luvlo_mio Posts: 1, Reputation: 1 New Member #5 Sep 14, 2009, 08:18 PM
Hi
So I'm having to deal with a very similar problem except the numbers are different. They are from the wileyplus accounting book and the entire problem is actually a two part one. The instructions read... The summaries of data from the balance sheet, income statement, and retained earnings statement for two corporations, Elder Corporation and Holden Enterprises, are presented below for 2010.

Elder Corporations
Beginning of the year
Total Assets \$117,225
Total Liabilities 73,360
Total Stockholders Eq (A) 743,895

End of the year
Total Assets (b)162,232
Total Liabilities 113,954
Total Stockholders Equi 48,278

Dividends (C)
Total Revenues 217,515
Total Expenses 162,112

The other corporations information was already provided by the original user above. The enclosed letters, some with numbers besides them, were the missing ones and I'm having a really hard time trying to find the dividends and also as the person above the letter f, as in the revenue for the holden corporation. Thank you.
 ArcSine Posts: 969, Reputation: 106 Senior Member #6 Sep 15, 2009, 04:41 AM
For both questions, you only need the equations

Beginning Equity + Net Income - Dividends = Ending Equity

Revenues - Expenses = Net Income

Keep in mind that if you know all but one of the variables, you can easily calculate the missing one. For example, if you know the amounts for Net Income and Expenses, then the amount of Revenues becomes obvious.

Also remember that solving one of the equations might give you a number to plug into the other equation, to help you solve the second one.
 Satine1 Posts: 1, Reputation: 1 New Member #7 Sep 18, 2009, 11:53 AM
Hi, All the above answers have been very helpful, however I am unsure about how to find the shareholders' investments. I'm aware that there's an answer that touches on shareholders investments but I'm a bit foggy on the exact equation to use. I was given the assets, liability & equity for the beginning and end ( dec 31, 2008 & dec 31, 2009) Also the net income and dividends paid during 2009. So again, please how do I find the shareholders' investements during 2009?
 ArcSine Posts: 969, Reputation: 106 Senior Member #8 Sep 18, 2009, 12:45 PM
Beginning Equity + Net Income + Additional Shareholder Investment - Dividends = Ending Equity.

Finding the one item that's in bold will be easy, since you have the other four 'ingredients' in this equation.

Does that put you onto the right track?
 morgaine300 Posts: 6,561, Reputation: 276 Uber Member #9 Sep 18, 2009, 05:31 PM

Shareholder investment is stock, if that helps.