The Samba Company, During 2010, Reported Net Income on Its

Essay

The Samba Company, during 2010, reported net income on its income statement of $90, 000.There were 8, 000 shares of common stock outstanding during the entire year, and a $5 per-share dividend was declared on November 21, 2010.During the year, it was discovered that depreciation of $50, 000 was overstated in 2008 on some production equipment.The retained earnings balance on January 1, 2010 was $300, 000, and the income tax rate on all items of income is 40%.
Required:
Prepare a retained earnings statement for the year ended December 31, 2010.