How is the consolidated ending retained earnings balance calculated?
A)Add the beginning consolidated retained earnings to consolidated net income and subtract the parent company's dividends declared.
B)Add together the ending retained earnings of all the affiliated companies.
C)Adjust the parent company's opening retained earnings for the subsidiary's profits and dividends
D)Adjust the parent company's ending retained earnings for the subsidiary's profits and dividends

Question

Quizplus · Accepted Answer

The consolidated ending retained earnings balance is calculated by adding the beginning consolidated retained earnings to the consolidated net income and then subtracting the parent company's dividends declared. This calculation takes into account the profits and losses of all the affiliated companies and gives a final balance for the group's retained earnings at the end of the period.

How Is the Consolidated Ending Retained Earnings Balance Calculated