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    harmandeep's Avatar
    harmandeep Posts: 5, Reputation: 1
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    #1

    Mar 25, 2009, 07:13 AM
    Statement of retained earnings?
    Firm A has COGS equal to $500000 for the year ended 2004.gross profit for the year also was $500000 and the profit margin for the year was 15%.the retention rate for the year was 80%,and year 2004 was the firm first year of operations.
    Based on the info. please provide the statement of retained earnings for the yearended2004 for firm A.
    ROLCAM's Avatar
    ROLCAM Posts: 1,420, Reputation: 23
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    #2

    May 4, 2009, 06:47 AM

    Firm A has Cost of Goods Sold equal to $500,000 for the year ended 2004.

    Gross profit for the year also was $500,000 and the profit margin for the year was 15%.

    The retention rate for the year was 80%,and year 2004 was the firm first year of operations.
    Based on the info. please provide the statement of retained earnings for the year ended 2004 for firm A.

    ______________________________________

    2004.

    Sales = $1,000,000
    Cogs = $ 500,000
    _______________
    Gross margin = $ 500,000
    Expenses ***= $ 350,000
    ___________________________

    Net Profit ****= $150,000 = 15% of Sales.
    ============================

    Statement of retained earnings for the year ended 2004 .

    NET PROFIT as above = $150,000.
    Dividend 20% ******= $ 30,000.
    ______________________________

    RETAINED EARNINGS = $120,000 = 80% N P.

    ==============================
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