Question

DW has an ending Retained Earnings balance of $51,100. If during the year DW paid dividends of $4,300 and had net income of $22,500, then what was the beginning Retained Earnings balance? A. $24,300.B. $300.C. $32,900.D. $69,300.

Answer 1

Answer:

C. $32,900

Explanation:

The computation of the beginning retained earning balance is shown below"

As we know that

The ending balance of retained earning = Beginning balance of retained earnings + net income - dividend paid

$51,100 = Beginning retained earning balance + $22,500 - $4,300

$51,100 = Beginning retained earning balance + $18,200

So, the beginning retained earning balance would be

= $51,100 - $18,200

= $32,900