Slide 13-1. Slide 13-2 Chapter 11 Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings Financial Accounting, Seventh Edition.

Slide 13-1

Slide 13-2

Chapter 11Corporations: Corporations:

Organization, Stock Organization, Stock Transactions, Dividends, and Transactions, Dividends, and

Retained EarningsRetained Earnings

Financial Accounting, Seventh Edition

Slide 13-3

1. Identify the major characteristics of a corporation.

2. Record the issuance of common stock.

3. Explain the accounting for treasury stock.

4. Differentiate preferred stock from common stock.

5. Prepare the entries for cash dividends and stock

dividends.

6. Identify the items that are reported in a retained

earnings statement.

7. Prepare and analyze a comprehensive stockholders’

equity section.

Study ObjectivesStudy ObjectivesStudy ObjectivesStudy Objectives

Slide 13-4

Cash dividendsCash dividends

Stock dividendsStock dividends

Stock splitsStock splits

Corporate Corporate Organization and Organization and

Stock Stock TransactionsTransactions

Corporate Corporate Organization and Organization and

Stock Stock TransactionsTransactions

Corporate form of Corporate form of organizationorganization

Common stock Common stock issuesissues

Treasury stockTreasury stock

Preferred stockPreferred stock

Retained earnings Retained earnings restrictionsrestrictions

Prior period Prior period adjustmentsadjustments

Retained earnings Retained earnings statementstatement

DividendsDividendsDividendsDividends Retained Retained EarningsEarningsRetained Retained EarningsEarnings

Statement Statement Presentation and Presentation and

AnalysisAnalysis

Statement Statement Presentation and Presentation and

AnalysisAnalysis

Corporations: Organization, Stock Transactions, Corporations: Organization, Stock Transactions, Dividends, and Retained EarningsDividends, and Retained Earnings

Corporations: Organization, Stock Transactions, Corporations: Organization, Stock Transactions, Dividends, and Retained EarningsDividends, and Retained Earnings

PresentationPresentation

AnalysisAnalysis

Slide 13-5

An entity separate and distinct from its owners.

The Corporate Form of OrganizationThe Corporate Form of OrganizationThe Corporate Form of OrganizationThe Corporate Form of Organization

Classified by Purpose

Not-for-Profit

For Profit

Classified by Ownership

Publicly held

Privately held

McDonald’s Ford Motor Company PepsiCo Google

Salvation Army American Cancer

Society Gates

Foundation

Cargill Inc.

Slide 13-6

Separate Legal Existence

Limited Liability of Stockholders

Transferable Ownership Rights

Ability to Acquire Capital

Continuous Life

Corporate Management

Government Regulations

Additional TaxesSO 1 Identify the major characteristics of a SO 1 Identify the major characteristics of a

corporation.corporation.

Advantages

Disadvantages

The Corporate Form of OrganizationThe Corporate Form of OrganizationThe Corporate Form of OrganizationThe Corporate Form of Organization

Characteristics that distinguish corporations from proprietorships and partnerships.

Slide 13-7


Characteristics of a CorporationCharacteristics of a CorporationCharacteristics of a CorporationCharacteristics of a Corporation

SO 1 Identify the major characteristics of a SO 1 Identify the major characteristics of a corporation.corporation.

Corporation acts under its own name rather than in the name of its stockholders.





Continuous Life



Additional Taxes

Slide 13-8




Limited to their investment.





Continuous Life



Additional Taxes

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Shareholders may sell their stock.





Continuous Life



Additional Taxes

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Corporation can obtain capital through the issuance of stock.





Continuous Life



Additional Taxes

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Continuance as a going concern is not affected by the withdrawal, death, or incapacity of a stockholder, employee, or officer.





Continuous Life



Additional Taxes

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Continuous Life



Additional Taxes




Separation of ownership and management prevents owners from having an active role in managing the company.

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Continuous Life



Additional Taxes




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Continuous Life



Additional Taxes




Corporations pay income taxes as a separate legal entity and in addition, stockholders pay taxes on cash dividends.

Slide 13-15



Stockholders

Chairman and Board of Directors

President andChief Executive

Officer

General Counsel and

Secretary

Vice PresidentMarketing

Vice PresidentFinance/Chief

Financial Officer

Vice PresidentOperations

Vice PresidentHuman

Resources

Treasurer Controller

Illustration 11-1 Corporation organization chart

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File application with the Secretary of State.

State grants charter.

Corporation develops by-laws.

Initial Steps:

Forming a CorporationForming a CorporationForming a CorporationForming a Corporation


Companies generally incorporate in a state whose laws are favorable to the corporate form of business (Delaware, New Jersey).

Corporations expense organization costs as incurred.

Slide 13-18

1. Vote in election of board of directors and on actions that require stockholder approval.

Stockholders have the right to:

Ownership Rights of StockholdersOwnership Rights of StockholdersOwnership Rights of StockholdersOwnership Rights of Stockholders


2. Share the corporate earnings through receipt of dividends.

Illustration 11-3

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3. Keep the same percentage ownership when new shares of stock are issued (preemptive right*).




* A number of companies have eliminated the preemptive right.

Illustration 11-3

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4. Share in assets upon liquidation in proportion to their holdings. This is called a residual claim.




Illustration 11-3

Slide 13-21



Class A COMMON STOCK

Class A COMMON STOCK

PAR VALUE $1 PER SHARE

PAR VALUE $1 PER SHARE

Stock Certificate

Stock Certificate

Name of corporation

Stockholder’s name

Class

Shares

Signature of corporate official

PrenumberedIllustration 11-4

Slide 13-22

Stock Issue ConsiderationsStock Issue ConsiderationsStock Issue ConsiderationsStock Issue Considerations


Charter indicates the amount of stock that a

corporation is authorized to sell.

Number of authorized shares is often reported in

the stockholders’ equity section.

Authorized Stock

Slide 13-23



Corporation can issue common stock directly to investors or indirectly through an investment banking firm.

Factors in setting price for a new issue of stock:

1. the company’s anticipated future earnings

2. its expected dividend rate per share

3. its current financial position

4. the current state of the economy

5. the current state of the securities market

Issuance of Stock

Slide 13-24



Stock of publicly held companies is traded on

organized exchanges.

Interaction between buyers and sellers determines

the prices per share.

Prices set by the marketplace tend to follow the

trend of a company’s earnings and dividends.

Factors beyond a company’s control, may cause

day-to-day fluctuations in market prices.

Market Value of Stock

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Years ago, par value determined the legal capital

per share that a company must retain in the

business for the protection of corporate creditors.

Today many states do not require a par value.

No-par value stock is quite common today.

In many states the board of directors assigns a

stated value to no-par shares.

Par and No-Par Value Stock

Slide 13-27

Paid-in CapitalPaid-in CapitalPaid-in CapitalPaid-in Capital

Retained Retained EarningsEarningsAccountAccount


Paid-in Capital Paid-in Capital in Excess of Parin Excess of Par

AccountAccount


AccountAccount

Two Primary Sources of

Equity

Common StockCommon StockAccountAccount


Preferred StockPreferred StockAccountAccount


Corporate CapitalCorporate CapitalCorporate CapitalCorporate Capital

Paid-in capital is the total amount of cash and other assets paid in to the corporation by stockholders in exchange for capital stock.


Slide 13-28




Additional Paid-Additional Paid-in Capitalin CapitalAccountAccount

Additional Paid-Additional Paid-in Capitalin CapitalAccountAccount


Equity






Retained earnings is net income that a corporation retains for future use.


Slide 13-29


Comparison of the owners’ equity (stockholders’ equity) accounts reported on a balance sheet for a proprietorship and a corporation.

Illustration 11-6


Slide 13-30

At the end of its first year of operation, Doral

Corporation has $750,000 of common stock

and

Solution on notes page

net income of $122,000. Prepare (a) the closing entry for net

income and (b) the stockholders’ equity section at year-end.



Slide 13-31

Primary objectives:

1) Identify the specific sources of paid-in capital.

2) Maintain the distinction between paid-in capital and retained earnings.

Accounting for Common Stock IssuesAccounting for Common Stock IssuesAccounting for Common Stock IssuesAccounting for Common Stock Issues

SO 2 Record the issuance of common stock.SO 2 Record the issuance of common stock.

Other than consideration received, the issuance of common stock

affects only paid-in capital accounts.

Slide 13-32

IllustrationIllustration: : Assume that Hydro-Slide, Inc. issues 2,000 shares of $1 par value common stock. Prepare Hydro-Slide’s journal entry if (a) 1,000 share are issued for $1 per share, and (b) 1,000 shares are issued for $5 per share.

Cash 1,000

Common stock (1,000 x $1)

1,000Cash 5,000


1,000Paid-in capital in excess of par value

4,000

a.

b.



Issuing Par Value Common Stock for Cash

Slide 13-33



Illustration 11-7

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IllustrationIllustration: : Assume that Hydro-Slide, Inc. issues 5,000 shares of $5 stated value no-par common stock for $8 per share. The entry is:

Cash 40,000


25,000Paid-in capital in excess of stated value

15,000



Issuing No-Par Common Stock for Cash

Prepare the entry assuming there is no stated value?

Cash 40,000

Common stock

40,000

Slide 13-35

Issuing Common Stock for Services orNoncash Assets

Corporations also may issue stock for:

Services (attorneys or consultants).

Noncash assets (land, buildings, and equipment).



Cost is either the fair market value of the consideration given up, or the fair market value of the consideration received, whichever is more clearly determinable.

Slide 13-36

Illustration: Assume that attorneys have helped Jordan Company incorporate. They have billed the company $5,000 for their services. They agree to accept 4,000 shares of $1 par value common stock in payment of their bill. At the time of the exchange, there is no established market price for the stock. Prepare the journal entry for this transaction.

Organizational expense 5,000


4,000Paid-in capital in excess of par

1,000



Slide 13-37

Illustration: Assume that Athletic Research Inc. is an existing publicly held corporation. Its $5 par value stock is actively traded at $8 per share. The company issues 10,000 shares of stock to acquire land recently advertised for sale at $90,000. Prepare the journal entry for this transaction.

Land (10,000 x $8) 80,000


50,000Paid-in capital in excess of par

30,000



Slide 13-38





AccountAccount


AccountAccount

Less:Less:Treasury StockTreasury Stock

Account

Less:Less:Treasury StockTreasury Stock

Account


Equity





Accounting for Treasury StockAccounting for Treasury StockAccounting for Treasury StockAccounting for Treasury Stock

SO 3 Explain the accounting for treasury stock.SO 3 Explain the accounting for treasury stock.

Slide 13-39

Treasury stock - corporation’s own stock that it has reacquired from shareholders, but not retired.

Corporations purchase their outstanding stock:

1. To reissue the shares to officers and employees under

bonus and stock compensation plans.

2. To enhance the stock’s market value.

3. To have additional shares available for use in the

acquisition of other companies.

4. To increase earnings per share.

5. To rid the company of disgruntled investors, perhaps to

avoid a takeover.



Slide 13-40

Purchase of Treasury Stock

Debit Treasury Stock for the price paid to

reacquire the shares.

Treasury stock is a contra stockholders’ equity

account, not an asset.

Purchase of treasury stock reduces

stockholders’ equity.



Slide 13-41

Treasury stock (4,000 x $8) 32,000

Cash

32,000

Illustration: On February 1, 2011, Mead acquires 4,000 shares of its stock at $8 per share.



Illustration 11-8

Slide 13-42



Stockholders’ Equity with Treasury stock

Both the number of shares issued (100,000), outstanding (96,000), and the number of shares held as treasury (4,000) are disclosed.

Illustration 11-9

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Disposal of Treasury Stock

Above Cost

Below Cost

Both increase total assets and stockholders’ equity.



Slide 13-45

Treasury stock (1,000 x $8)

8,000

Illustration: On February 1, 2011, Mead acquired 4,000 shares of its stock at $8 per share.

On July 1, Mead sells for $10 per share 1,000 shares of its treasury stock, previously acquired at $8 per share.



Above Cost

July 1

Paid-in capital treasury stock

2,000

Cash 10,000

A corporation does not realize a gain or suffer a loss from stock transactions with its own stockholders.

Slide 13-46

Paid-in capital treasury stock 800


On Oct. 1, Mead sells an additional 800 shares of treasury stock at $7 per share.



Oct. 1

Treasury stock (800 x $8)

6,400

Cash 5,600

Mead uses Paid-in Capital from Treasury Stock, if available, for the difference between cost and resale price of the shares.

Below Cost

Slide 13-47

Paid-in capital treasury stock 1,200


On Dec. 1, assume that Mead, Inc. sells its remaining 2,200 shares at $7 per share.



Dec. 1

Retained earnings 1,000

Cash 15,400

Treasury stock (2,200 x $8)

17,600

Below Cost

Limited to

balance on hand

Slide 13-48

Features often associated with preferred stock.

1. Preference as to dividends.

2. Preference as to assets in liquidation.

3. Nonvoting.

SO 4 Differentiate preferred stock from common stock.

Preferred StockPreferred StockPreferred StockPreferred Stock

Accounting for preferred stock at issuance is similar to that for common stock.

Slide 13-49

Illustration: Stine Corporation issues 10,000 shares of$10 par value preferred stock for $12 cash per share. Journalize the issuance of the preferred stock.



Cash 120,000

Preferred stock (10,000 x $10)

100,000Paid-in capital in excess of par – Preferred stock

20,000Preferred stock may have a par value or no-par value.

Slide 13-50

Dividend Preferences

Right to receive dividends before common stockholders.

Per share dividend amount is stated as a percentage of the preferred stock’s par value or as a specified amount.

Cumulative dividend – holders of preferred stock must be paid their annual dividend plus any dividends in arrears before common stockholders receive dividends.



Slide 13-51

A distribution of cash or stock to stockholders on a pro rata (proportional) basis.

Types of Dividends:

DividendsDividends

SO 5 Prepare the entries for cash dividends and stock SO 5 Prepare the entries for cash dividends and stock dividends.dividends.

1. Cash dividends.

2. Property dividends.

Dividends expressed: (1) as a percentage of the par or stated value, or (2) as a dollar amount per share.

3. Scrip (note)

4. Stock dividends.

Slide 13-52

Dividends require information concerning three dates:

DividendsDividends


Illustration 11-12

Slide 13-53

Cash Dividends

For a corporation to pay a cash dividend, it must

have:

1. Retained earnings - Payment of cash dividends

from retained earnings is legal in all states.

2. Adequate cash.

3. A declaration of dividends by the Board of

Directors.

Cash DividendsCash Dividends


Slide 13-54

Illustration: On Dec. 1, the directors of Media General declare a 50¢ per share cash dividend on 100,000 shares of $10 par value common stock. The dividend is payable on Jan. 20 to shareholders of record on Dec. 22?

December 1 (Declaration Date)


Dividends payable 50,000

December 22 (Date of Record)

January 20 (Payment Date)


Dividends payable 50,000

Cash 50,000

No entry


Slide 13-55

Allocating Cash Dividends Between Preferred and Common Stock


Holders of cumulative preferred stock must be paid any unpaid prior-year dividends before common stockholders receive dividends.


Slide 13-56 SO 5 Prepare the entries for cash dividends and stock SO 5 Prepare the entries for cash dividends and stock

dividends.dividends.

Illustration: On December 31, 2011, IBR Inc. has 1,000 shares of 8%, $100 par value cumulative preferred stock. It also has 50,000 shares of $10 par value common stock outstanding. At December 31, 2011, the directors declare a $6,000 cash dividend. Prepare the entry to record the declaration of the dividend.


Dividends payable

6,000Pfd Dividends: 1,000 shares x $100 par x 8% = $8,000




2011 2012

Dividends declared 6,000$

Dividends in arrears

Allocation to pref erred 6,000

Remainder to common -$

* 1,000 shares x $100 par x 8% = $8,000

*

** 2010 Pfd. dividends $8,000 – declared $6,000 = $2,000

**

Illustration: At December 31, 2012, IBR declares a $50,000 cash dividend. Show the allocation of dividends to each class of stock.

$ 50,0002,000

8,000

$ 40,000





Dividends payable

50,000

Illustration: At December 31, 2012, IBR declares a $50,000 cash dividend. Prepare the entry to record the declaration of the dividend.


Slide 13-59

Slide 13-60

Stock Dividends

Pro rata distribution of the corporation’s own stock.

Stock DividendsStock Dividends


Results in decrease in retained earnings and increase in paid-in capital.

Illustration 11-14

Slide 13-61

Stock Dividends

Reasons why corporations issue stock dividends:

1. To satisfy stockholders’ dividend expectations

without spending cash.

2. To increase the marketability of the corporation’s

stock.

3. To emphasize that a portion of stockholders’ equity

has been permanently reinvested in the business.



Slide 13-62

Size of Stock Dividends

Small stock dividend (less than 20–25% of the corporation’s issued stock, recorded at fair market value)

Large stock dividend (greater than 20–25% of issued stock, recorded at par value)



* This accounting is based on the assumption that a small stock dividend will have little effect on the market price of the outstanding shares.

*

Slide 13-63

10% stock dividend is declared

Retained earnings (50,000 x 10% x $15) 75,000

Common stock dividends distributable 50,000

Paid-in capital in excess of par value

25,000

Stock issued

Common stock dividends distributable

50,000

Common stock 50,000

Illustration: Medland Corp. has 50,000 shares issued and outstanding. The par value is $10 per share and market value is $15 per share.



Slide 13-64

Stockholders' equityPaid-in capital

Common stock 500,000$ Common stock dividends distributable 50,000

Total stockholders' equity 550,000$

Medland CorporationBalance Sheet (partial)

Stockholders’ Equity with Dividends Distributable



Illustration 11-15

Slide 13-65



Effects of Stock DividendsIllustration 11-16

Slide 13-66

Which of the following statements about small stock dividends is true?

a. A debit to Retained Earnings for the par value of the shares issued should be made.

b. A small stock dividend decreases total stockholders’ equity.

c. Market value per share should be assigned to the dividend shares.

d. A small stock dividend ordinarily will have no effect on book value per share of stock.

Question



Slide 13-67

In the stockholders’ equity section, Common Stock Dividends Distributable is reported as a(n):

a. deduction from total paid-in capital and retained earnings.

b. current liability.

c. deduction from retained earnings.

d. addition to capital stock.

Question



Slide 13-68

Stock Split

Reduces the market value of shares.

No entry recorded for a stock split.

Decrease par value and increase number of

shares.

Stock SplitsStock Splits


Slide 13-69

Illustration: Assume Medland Corporation splits its

50,000 shares of common stock on a 2-for-1 basis.


Illustration 11-17

Results in a reduction of the par or stated value per share.

Stock SplitsStock Splits

Slide 13-70

Retained earnings is net income that a

company retains for use in the business.

Net income increases Retained Earnings and a

net loss decreases Retained Earnings.

Retained earnings is part of the stockholders’

claim on the total assets of the corporation.

A debit balance in Retained Earnings is identified

as a deficit.

Retained EarningsRetained Earnings

SO 6 Identify the items reported in a retained earnings SO 6 Identify the items reported in a retained earnings statement.statement.

Slide 13-71

Restrictions can result from:

1. Legal restrictions.

2. Contractual restrictions.

3. Voluntary restrictions.

Retained Earnings RestrictionsRetained Earnings Restrictions


Illustration 11-22

Slide 13-72

Corrections of Errors

Result from: mathematical mistakes mistakes in application of accounting

principles oversight or misuse of facts

Corrections treated as prior period

adjustments

Adjustment made to the beginning balance of

retained earnings

Prior Period AdjustmentsPrior Period Adjustments


Slide 13-73

Woods, Inc.Statement of Retained Earnings

For the Year Ended December 31, 2011

Balance, January 1 1,050,000$ Net income 360,000 Dividends (300,000) Balance, December 31 1,110,000$

Before issuing the report for the year ended December 31, 2011, you discover a $50,000 error (net of tax) that caused the 2010 inventory to be overstated (overstated inventory caused COGS to be lower and thus net income to be higher in 2010. Would this discovery have any impact on the reporting of the Statement of Retained Earnings for 2011?



Slide 13-74

Woods, Inc.Statement of Retained Earnings

For the Year Ended December 31, 2011

Balance, January 1, as previously reported 1,050,000$ Prior period adjustment - error correction (50,000) Balance, January 1, as restated 1,000,000 Net income 360,000 Dividends (300,000) Balance, December 31 1,060,000$



Slide 13-75

Retained Earnings StatementRetained Earnings Statement


The company prepares the statement from the Retained Earnings account.

Illustration 11-24

Slide 13-76



Illustration 11-25

Slide 13-77

All but one of the following is reported in a retained earnings statement. The exception is:

a. cash and stock dividends.

b. net income and net loss.

c. some disposals of treasury stock below cost.

d. sales of treasury stock above cost.

Question



Slide 13-78

SO 7

Statement Presentation and AnalysisStatement Presentation and Analysis

Illustration 11-26

Slide 13-79

Analysis

Net Income Available to Common Stockholders

Return on Common

Stockholders’ Equity

= Average Common

Stockholders’ Equity

SO 7 Prepare and analyze a comprehensive stockholders’ equity section.

Statement Analysis and PresentationStatement Analysis and Presentation

This ratio shows how many dollars of net income the company earned for each dollar invested by the stockholders.

Slide 13-80

Analysis

SO 7 Prepare and analyze a comprehensive stockholders’ equity section.

Statement Analysis and PresentationStatement Analysis and Presentation

Illustration: Kellogg Company’s beginning-of-the-year and end-of-the-year common stockholders’ equity were $2,526 and $1,448 million, respectively. Its net income was $1,148 million, and no preferred stock was outstanding. The return on common stockholders’ equity ratio is computed as follows.

Solution on notes page

Illustration 11-28

Slide 13-81

Home-equity loans are now difficult to get. The reasons are that banks are not making the loans, and sinking home prices give homeowners less equity to borrow against.

Four major reasons why many individuals employ home-equity loans are: (1) to invest, (2) to get a tax deduction, (3) to defer other debt, or (4) to buy from a wish list.

Home-Equity Loans

Slide 13-82

While home-equity loans tend to have fixed rates, home-equity lines of credit, which allow the homeowner to borrow up to a certain amount whenever they want to, have variable rates. Rates on home-equity lines of credit averaged 8.33% in April 2006, versus about 14% for credit card debt.

Home-equity loan interest is tax-deductible (like home mortgage interest). Interest on car loans, most student loans, and credit cards is not.

Slide 13-83

Home-equity loans can be very tempting. Suppose that you wanted to borrow $5,000to take a vacation. You could spread your payments over 15 years and you would haveto pay only about $50 per month. But look what your total payments would be over thelife of the 15-year loan. Some vacation!

Slide 13-84

Your home has increased in value by $50,000 during the last five years. You have very little savings outside of the equity in your home. You desperately need a vacation, and you are considering taking out a $5,000 home-equity loan to finance a two-week dream vacation in Europe. Is this is a bad idea?YES: This represents a significant portion of your savings. Home-equity loans should be used to finance investments of a lasting nature, not items of a fleeting nature like vacations.

NO: You need a vacation. If you use a little of the equity in your home now, you can make it up when your house increases in value in the future.

Slide 13-85

Stockholders’ Equity StatementStockholders’ Equity Statement

SO 8 Describe the use and content of the stockholders’’ SO 8 Describe the use and content of the stockholders’’ statement.statement.

Appendix Appendix 11A11A

Illustration 11A-1

When a stockholders’ equity statement is presented, a retained earnings statement is not necessary.

Slide 13-86

Book Value—Another Per-Share AmountBook Value—Another Per-Share Amount

Appendix Appendix 11B11B

Illustration 11B-1

The equity a common stockholder has in the net assets of the corporation.

Book Value per Share

SO 9 Compute book value per share.SO 9 Compute book value per share.

Slide 13-87



The computation of book value per share involves the following steps.

1. Compute the preferred stock equity. This equity is equal to the sum of the call price of preferred stock plus any cumulative dividends in arrears. If the preferred stock does not have a call price, the par value of the stock is used.

2. Determine the common stock equity. Subtract the preferred stock equity from total stockholders’ equity.

3. Determine book value per share. Divide common stock equity by shares of common stock outstanding.

Book Value per Share


Slide 13-88


Appendix Appendix 11B11BIllustration: using the stockholders’ equity section of

Graber Inc. shown in Illustration 11-26. Graber’s preferred stock is callable at $120 per share and is cumulative. Assume that dividends on Graber’s preferred stock were in arrears for one year, $54,000 (6,000 $9). The computation of preferred stock equity (Step 1 in the preceding list) is:

Illustration 11B-2


Slide 13-89


Computation of book value:

Illustration 11B-2

Illustration 11B-3


Slide 13-90




The correlation between book value and the annual range of a company’s market value per share is often remote.

Book Value versus Market Value

Illustration 11B-4

Slide 13-91

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Slide 13-1. Slide 13-2 Chapter 11 Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings Financial Accounting, Seventh Edition.

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