Question

The following information is available for the Noir Detective Agency. After closing entries are posted, what will be the balance in the Retained earnings account

Answer 1

Answer: $230,400

Explanation:

The Retained earnings account is mainly used to record how much the company retains from its past and present net incomes after paying out dividends to shareholders.

Ending Balance = Beginning balance + Net income - dividends

= 294,000 + (-27,600) - 36,000

= $230,400