If net income for the period was $134,250,dividends distributed were $76,530,and ending retained earnings was $862,520,what was the beginning retained earnings for the period?
A)$1,073,300
B)$651,740
C)$804,800
D)$920,240
E)$728,270

Question

Quizplus · Accepted Answer

Beginning retained earnings = Ending retained earnings from previous period + Net income - Dividends distributed
Assuming that there were no adjustments made to retained earnings during the period, we can calculate as follows:
Beginning retained earnings = $862,520 + $134,250 - $76,530
Beginning retained earnings = $920,240
Therefore, the answer is C) $804,800 is incorrect because it is the ending retained earnings from the current period, not the beginning retained earnings. A) $1,073,300 is incorrect because it is an arbitrary number not derived from the given information. B) $651,740 is incorrect because it does not take into account the net income and dividends distributed. E) $728,270 is incorrect because it also does not take into account the net income and dividends distributed.

If Net Income for the Period Was $134,250,dividends Distributed Were