The balance sheet of Old Gold Mines for the year ended June 30, 20x2, showed a balance in retained earnings of $6,000 million at the end of 20x2 and $4,600 million at the end of 20x1.Net income for 20x2 was $2,400, million.Compute the amount of dividends Old Gold Mines declared during 20x2.
A)$500 million
B)$1,000 million
C)$1,500 million
D)$2,000 million
E)$2,500 million

Question

Quizplus · Accepted Answer

The dividends declared can be calculated using the formula: Ending Retained Earnings = Beginning Retained Earnings + Net Income - Dividends. Plugging in the numbers: $6,000 million = $4,600 million + $2,400 million - Dividends. Solving for Dividends gives $1,000 million.

The Balance Sheet of Old Gold Mines for the Year