Question

Sheffield Corp. started the year with $63600 in its Common Stock account and a credit balance in Retained Earnings of $46600. During the year, the company earned net income of $50900, and declared and paid $21200 of dividends. In addition, the company sold additional common stock amounting to $29700. As a result, the balance in retained earnings at the end of the year would be?

Answer 1

Answer:

The balance in retained earnings at the end of the year will be $70,300.

Explanation:

Retained earning beginning balance = $46,600

Net Income for the year = $50,900

Dividend Paid = $21,200

Retained earning Ending balance = Retained earning beginning balance + Net Income for the year - Dividend paid during the year

Retained earning Ending balance = $46,600 + $50,900 - $21,200

Retained earning Ending balance = $70,300

So, the balance in retained earnings at the end of the year will be $70,300.