Snowberry Corporation had a net increase in Retained Earnings of $182,000 for the year.The corporation also paid $56,000 of cash dividends that had been declared in the previous year.This year,the corporation declared $50,400 of dividends but has not paid them as of year-end.Given this information,the net income for the current year must have been:
A)$176,400
B)$238,000
C)$182,000
D)$232,400

Question

Quizplus · Accepted Answer

Ending Retained Earnings = Beginning Retained Earnings + Net income − Cash dividends (declared)
Ending Retained Earnings − Beginning Retained Earnings = Net income − Cash dividends (declared)
Change in Retained Earnings = Net income − Cash dividends (declared)
Net income = Change in Retained Earnings + Cash dividends (declared)
= $182,000 + $50,400 = $232,400

Snowberry Corporation Had a Net Increase in Retained Earnings of $182,000