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CP 12–2

14 August, 2015 - 17:32
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Refer to CP 12–1. Assume that the proprietorship is instead a corporation named R. Black Ltd., with 1,000 common shares issued on January 1, 2016 for a stated value of $5 per share. Assume there are no opening retained earnings and consider withdrawals to be dividends. Assume income taxes expense applies to corporate earnings.

Required:

  1. Prepare an income statement for the year ended December 31, 2016.
  2. Prepare a statement of changes in equity.
  3. Prepare a balance sheet at December 31, 2016.
  4. Prepare closing entries at year-end.
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