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Question 4 On December 31, 2016, Swifty Company SA had 1,651,000 10 par ordinary shares issued and outstanding. The equity accounts at December 31, 2016, had the following balances. Share Capital-Ordinary Share Premium-Ordinary Retained Earnings 16,510,000 1,651,000 859,900 Transactions during 2017 and other information related to equity accounts were as follows. 1. 2. 3. On January 10, 2017, Andes issued at 106 per share 104,700 100 par value, 8% cumulative preference shares. On February 8, 2017, Andes reacquired 14,490 ordinary shares for 14 per share. On June 8, 2017, Andes declared a cash dividend of 1 per share on the ordinary shares outstanding, payable on July 10, 2017, to shareholders of record on July 1, 2017. On December 15, 2017, Andes declared the yearly cash dividend on preference shares, payable January 10, 2018, to shareholders of record on December 15, 2017. Net income for the year is 3,346,900. It was discovered that depreciation expense had been understated in 2016 by 52,650. 4. 5. 6. (a) Prepare a retained earnings statement for the year ended December 31, 2017. (List items that increase retained earnings first.) SWIFTY COMPANY SA Retained Earnings Statement For the Year Ended December 31, 2017 Balance, January 1, as reported Correction of Overstatement Net Income in 2013 Balance, January 1, as adjusted Add v Net Income / (Loss) Less Cash Dividends-Ordinary Cash Dividends-Preference Balance, December 31

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