Joe Novak Corporation reports the following information: Correction of overstatement of depreciation expense $\begin{array}{lr}
\text { in prior years, net of tax } & \$ 215,000 \
\text { Dividends declared } & 160,000 \
\text { Net income } & 500,000 \
\text { Retained earnings, } 1 / 1 / 07 \text { as reported } & 1,000,000
\end{array}$

Joe Novak should report retained earnings, 12/31/07, at
A)$785,000.
B)$1,125,000.
C)$1,340,000.
D)$1,555,000.

Question

Joe Novak Corporation reports the following information: Correction of overstatement of depreciation expense $\begin{array}{lr}
\text { in prior years, net of tax } & \$ 215,000 \
\text { Dividends declared } & 160,000 \
\text { Net income } & 500,000 \
\text { Retained earnings, } 1 / 1 / 07 \text { as reported } & 1,000,000
\end{array}$

Joe Novak should report retained earnings, 12/31/07, at
A)$785,000.
B)$1,125,000.
C)$1,340,000.
D)$1,555,000.

Quizplus · Accepted Answer

The Answer of Joe Novak Corporation reports the following information: Correction of overstatement of depreciation expense $\begin{array}{lr}
\text { in prior years, net of tax } & \$ 215,000 \
\text { Dividends declared } & 160,000 \
\text { Net income } & 500,000 \
\text { Retained earnings, } 1 / 1 / 07 \text { as reported } & 1,000,000
\end{array}$

Joe Novak should report retained earnings, 12/31/07, at
A)$785,000.
B)$1,125,000.
C)$1,340,000.
D)$1,555,000.

Joe Novak Corporation Reports the Following Information: Correction of Overstatement