Ask Question
21 August, 16:35

A company's retained earnings at the beginning of the year is $1 million. It paid $100,000 in dividends, had $250,000 in net income, and its goodwill increased by $10,000. What is its retained earnings as of the end of the year?

+5
Answers (1)
  1. 21 August, 19:10
    0
    Answer: $1,160,000

    Explanation:

    Given:

    Retained earnings (beginning) = $1 million

    Dividend paid = $100,000

    Net income = $250,000

    Goodwill increased by = $10,000

    Therefore, we'll compute Retained earnings (end of the year) as:

    Retained earnings (end of the year) = Retained earnings (beginning) + Net income + Increase in Goodwill - Dividend paid

    Retained earnings (end of the year) = $1,000,000 + $250,000 + $10,000 - $100,000

    Retained earnings (end of the year) = $1,160,000
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “A company's retained earnings at the beginning of the year is $1 million. It paid $100,000 in dividends, had $250,000 in net income, and ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers