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[Note that the overview to Topic 4 explains why this is so.] Although the note receivable from Maynard was paid, a dividend for an offsetting amount was also paid—so there is no increase in cash as a result of the owner’s transactions.
3. Retained earnings has not increased by the amount of net income for the month ($19,635) because Maynard declared and paid a dividend of $11,700. Therefore, retained earnings increased $7,935 ($19,635 - $11,700). (The dividend was apparently used to “cancel” her debt to the company.)
4. As we discussed in class, we should not think of “worth” in terms of balance sheet accounts—which are stated at cost...
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Common topics in this essay:
- Purchasing And Cash Disbursement
- Inventory
- The Effect of Exchange Rate Changes on Hedge Funds' Net Asset Value
- Inventory of the lost
- inventory management
- Interest Inventory
- Inventory Policy
- Retail Inventory
- inventory models
- Inventory Valuation
- Just in time inventory
- Retail Inventory
- Competency Inventory
- Inventory Management
- Effects Of Inventory Errors
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