Use the following information for questions
Nelson Company experienced the following transactions during 2016,its first year in operation.
1.Issued $12,000 of common stock to stockholders.
2.Provided $4,600 of services on account.
3.Paid $3,200 cash for operating expenses.
4.Collected $3,800 of cash from accounts receivable.
5.Paid a $200 cash dividend to stockholders.
-The amount of retained earnings appearing on Nelson Company's December 31,2016 balance sheet is:
A)$1,200.
B)$1,000.
C)$1,400.
D)$13,200.

Question

Use the following information for questions 
Nelson Company experienced the following transactions during 2016,its first year in operation.
1.Issued $12,000 of common stock to stockholders.
2.Provided $4,600 of services on account.
3.Paid $3,200 cash for operating expenses.
4.Collected $3,800 of cash from accounts receivable.
5.Paid a $200 cash dividend to stockholders.
-The amount of retained earnings appearing on Nelson Company's December 31,2016 balance sheet is:
A)$1,200.
B)$1,000.
C)$1,400.
D)$13,200.

Quizplus · Accepted Answer

Retained earnings = $12,000 (common stock) + $4,600 (services on account) - $3,200 (operating expenses) - $3,800 (cash collected from accounts receivable) - $200 (cash dividend) = $1,200

Use the Following Information for Questions