Now Inc. released its annual results and financial statement. Grace is reading the summary in the business pages of today's paper. In its annual report this year, NOW Inc. reported a net income of $152 million. Last year, the company reported a retained earnings balance of $459 million, whereas this year it increased to $540 million. How much was paid out in dividends this year? a. $4 millionb. $360 millionc. $71 milliond. $233 million

Question

Business

Lizzy

3 January, 16:02

Now Inc. released its annual results and financial statement. Grace is reading the summary in the business pages of today's paper. In its annual report this year, NOW Inc. reported a net income of $152 million. Last year, the company reported a retained earnings balance of $459 million, whereas this year it increased to $540 million. How much was paid out in dividends this year? a. $4 millionb. $360 millionc. $71 milliond. $233 million

+4

Answers (1)

Know the Answer?

Kamden Petersen · Answer 1

Option (c) is correct.

Explanation:

Given that,

Retained earnings in the last year = $459 million

Net income in this year = $152 million

Retained earnings in this year = $540 million

Dividends paid this year:

= (Retained earnings in the last year + Net income in this year) - Retained earnings in this year

= ($459 million + $152 million) - $540 million

= $71 million

Therefore, the company paid out $71 million in dividends this year.