Why is balance in retained earinings so large

Reference no: EM13259476

The following info. was obtain from the record of Wilcox, Inc., asof Dec 31, 2006

Land..............$42500
Building..........197550
Salaries expense.......125350
Utilities expense.........5250
acct payable...........$38050
revenues................389950
supplies................72500
retained earning(1/1/06)....311000
Capital stock(2,000 share outstanding)....65000
acct receivable.....................90000
supplies expense.................110600
cash.....................................
note payable(long-term).....63800
rent expenses.................21200
Dividends in 2006.........95500
Other expenses............11250
Income taxes...............35000

Required:
1 Prepare an income statement for the year ended Dec 31 2006.
2 Prepare a classified balance sheet as of Dec 31 2006.
3 Interpertive Question: Why is the balance in Retained Eariningsso large as compared with the balance in Capital Stock?

Reference no: EM13259476

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