What is the amount of natures retained earnings at the end

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Reference no: EM132474236

Nature's shop reported the following account balances on its balance sheet on December 31, 2019

Accounts receivable

$25,000

Net property, plant and equipment

600,000

Cash and cash equivalent

300,000

Accounts payable

35,000

Bonds payable (3 years)

250,000

Prepaid insurance

30,000

Unearned gift card revenue

5,000

Accrued expenses payable

10,000

Merchandise inventory

150,000

Contributed capital

700,000

Retained earnings

 

Question 1. What is the amount of nature's retained earnings at the end of 2019.

Point 1. If the beginning balance of Nature's retained earning account was 10,000 and nature's declared 7500 dividends during year 2019, how much net income did nature's earn during year 2019.

Point 2. Nature's shop reported the following account balances on its balance sheet on December 31 2019

Point 3. Nature's wishes to purchase merchandise from your company on account. The amount of the purchases would probably be about 10,000 per month, and the terms would require nature to make payment in full within 30 days.

Question 2. Would you recommend that your company credit to nature under these terms?

Question 3. Explain the reasoning for your response.

Reference no: EM132474236

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