Assume that Sallisaw Sideboards, Inc. had a retained earnings balance of $10,000 on April 1, and that the company had the following transactions during April.

1. Issued common stock for cash, $5,000.

2. Provided services to customers on account, $2,000.

3. Provided services to customers in exchange for cash, $900.

4. Purchased equipment and paid cash, $4,300.

5. Paid April rent, $800.

6. Paid workers salaries for April, $700.

It is obvious that the requirement is the retained earnings at end of the year since the opening retained earnings and year's transactions were provided.

Closing retained earnings is $11,400

Explanation:

The net income for the year is calculated thus:

Sales ($2000+$900) $2,900

less expenses:

rent paid ($800)

salaries ($700)

Net income $1400

Hence closing retained earnings is opening retained earnings of $10,000 plus the net income realized in the year, which $11,400 ($10,000+$1,400).

The retained should be added to the share capital to arrive at shareholders' equity.