1. Introduction to Accounting Preparing for a User’s Perspective
Preparing and Using a Statement of Stockholder Equity
Debits and Credits Trainer
By Kevin C. Kimball, CPA
with support from
Free Jan. 2014
Available on the Google Play Store

2. Begin. Equity + Increases - Decreases End. Equity
Formula for the Statement of Stockholder Equity
Were dividends paid?
Please review our Statement of Stockholder Equity
How did my equity change?
Begin. Equity
+ Increases
- Decreases
End. Equity
Management
Stockholder

3. Total Stockholders’ Equity
Prior Ending Capital Stock
Capital Stock
Retained Earnings
Prior Ending Retained Earnings
Begin. Capital Stock
Begin. Retained Earnings
+ Issuances of Cap. Stock
+ Net Income
- Net Loss
- Repurchases of Cap. Stock
- Dividends
= End. Capital Stock
= End. Retained Earnings

4. Articulation $5 Income Statement Statement of Retained Earnings
Balance Sheet
Net Income $5
Assets = Liabilities + Equity
Begin. Retained Earnings $5 $0
+ $5
+ Net Income
- Net Loss
- Dividends
Net Assets = Equity
= End. Retained Earnings
$ = $5

5. Microsoft? No dividends from 1975 to 2003.
Which business’ owners chose to keep their Net Income in the business and thereby provide additional internally-generated equity financing?
Business 1
Business 2
Statement of Retained Earnings
For the year ended 12/31/X1
Beginning Retained Earnings, 1/1/X1
$100
+ Net Income
5,000
Dividends
(5,000)
= Ending Retained Earnings
$5,100
$ 100
Microsoft? No dividends from 1975 to 2003.

6. Retained Earnings (Deficit)
Title
Comparative
Units of measure
Net reduction
Capital Stock
Retained Earnings (Deficit)
Accumulated Other Comprehensive Income
(we’ll save this for another class)

7. Introduction to Accounting Preparing for a User’s Perspective
Preparing and Using a Statement of Stockholder Equity
Debits and Credits Trainer
By Kevin C. Kimball, CPA
with support from
Free Jan. 2014
Available on the Google Play Store