The following Stockholders' Equity section of Petal Pusher Company's balance sheet appeared at December 31,2017.
Answer the following:
$\begin{array}{lr}
\text { Common stock, } \$ 1 \text { par value, } 200,000 \text { shares issued } & \$ 200,000 \
\text { Additional paid-in capital—common } & 800,000 \
\text { Retained earnings } & \underline{450,000} \
\text { Total stockholders' equity } & \underline{\$ 1,450,000}
\end{array}$
?
A) $\text { Has the company been profitable since its inception? How do you know? }$ B) $\text {What does the balance in retained earnings represent? }$

Question

The following Stockholders' Equity section of Petal Pusher Company's balance sheet appeared at December 31,2017.
Answer the following:
 $\begin{array}{lr}
\text { Common stock, } \$ 1 \text { par value, } 200,000 \text { shares issued } & \$ 200,000 \
\text { Additional paid-in capital—common } & 800,000 \
\text { Retained earnings } &  \underline{450,000} \
\text { Total stockholders' equity } &  \underline{\$ 1,450,000}
\end{array}$
 ?
 A) $\text { Has the company been profitable since its inception? How do you know? }$  B) $\text {What does the balance in retained earnings represent? }$

Quizplus · Accepted Answer

The Answer of The following Stockholders' Equity section of Petal Pusher Company's balance sheet appeared at December 31,2017.
Answer the following:
 $\begin{array}{lr}
\text { Common stock, } \$ 1 \text { par value, } 200,000 \text { shares issued } & \$ 200,000 \
\text { Additional paid-in capital—common } & 800,000 \
\text { Retained earnings } &  \underline{450,000} \
\text { Total stockholders' equity } &  \underline{\$ 1,450,000}
\end{array}$
 ?
 A) $\text { Has the company been profitable since its inception? How do you know? }$  B) $\text {What does the balance in retained earnings represent? }$

The Following Stockholders' Equity Section of Petal Pusher Company's Balance