4 Net SalesCost of Goods SoldOther ExpensesDividends Declared & PaidRetained Earnings, 1/1/X8'Wealthy Manufacturing uses the equity method in accounting for its investment in Diversified Products. The controller was also awareof the following specific transactions for Diversified Products in 20X8, which were not included in the preceding data:1. Diversified sold its entire Health Technologies division on September 30, 20X8, for $375,000. The book value of HealthTechnologies division's net assets on that date was $331,000. The division incurred an operating loss of $15,000 in the first ninemonths of 20X8.2. During 20X8, Diversified sold one of its delivery trucks after it was involved in an accident and recorded a gain of $10,000.Required:a. Prepare an income statement and retained earnings statement for Diversified Products for 20X8.b. Prepare an income statement and retained earnings statement for Wealthy Manufacturing for 20X8.Req A1Complete this question by entering your answers in the tabs below.Req A2Wealthy Manufacturing$ 850,000670,00090,00030,000420,000Req B1Retained earnings, January 1, 20X8WEALTHY MANUFACTURING COMPANYRetained Earnings StatementYear Ended December 31, 20X8Prepare a retained earnings statement for Wealthy Manufacturing for 20X8.Note: Amounts to be deducted and loss amounts should be indicated by a minus sign.Retained earnings, December 31, 20X8Diversified Products$ 400,000A 320,00025,00010,000260,000Req B2$< Req B10Req B2

An income statement stands for the statement that shows profits and loss of the firm, its revenue…

Answered: a. Prepare an income statement and…

a. Prepare an income statement and retained earnings statement for Diversified Products for 20X8. b. Prepare an income statement and retained earnings statement for Wealthy Manufacturing for 20X8.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 6MCQ

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