As of December 31, 2010, Thomas Company had total assets of $156,000, total liabilities of $85,600, and common stock of $52,400. During 2011 Thomas earned $36,000 of cash revenue, paid $20,000 for cash expenses, and paid a $2,000 cash dividend to the stockholders.
Required
a. Determine the amount of retained earnings as of December 31, 2010, after closing.
b. Determine the amount of net income earned in 2011.
c. Determine the amount of retained earnings as of December 31, 2011, after closing.
d. Determine the amount of cash that is in the retained earnings account as of December 31,2011.