Albert Company reported the following statement of financial position amounts at December 31, 20B: What was the total amount of retained earnings on December 31, 20B?
A) $20,000
B) $50,000
C) $40,000
D) $30,000

Question

Albert Company reported the following statement of financial position amounts at December 31, 20B:  What was the total amount of retained earnings on December 31, 20B?
A) $20,000 
B) $50,000 
C) $40,000 
D) $30,000

Quizplus · Accepted Answer

The total amount of retained earnings can be calculated as follows: 
Retained earnings = Total assets – (Total liabilities + Shareholders' equity)
Retained earnings = $200,000 – ($100,000 + $60,000)
Retained earnings = $40,000 
Therefore, the correct answer is choice C.

Albert Company Reported the Following Statement of Financial Position Amounts