Answer:
The addition to retained earnings is $95,751.
Explanation:
Addition to the retained earning is the net value of net earning of the year and dividend payment.
Net income
Sales                                                $686,723
Costs                                               (<u>$335,000)</u>
Gross income                                  $351,723
Depreciation Expense                   <u>($80,000)</u>
Income before interest and tax     $271,723
Interest Expense                            <u>($45,000)</u>
Income before tax                           $226,723
Tax 22%                                          <u>($49,879)</u>
Net Income                                      <u>$176,844</u>
Addition to Retained Earning = Net Income - Dividend Payment
Addition to Retained Earning = $176,844 - $81,093
Addition to Retained Earning = $95,751