If there was no beginning retained earnings, net income of $30,300, and ending retained earnings of $8,000, how much were dividends?

Question

Quizplus · Accepted Answer

The dividends can be calculated by subtracting the ending retained earnings from the sum of the beginning retained earnings and net income. However, in this case, there is no information given about the beginning retained earnings. Thus, the only way to determine the amount of dividends is to use the formula: 
Dividends = Net Income - Ending Retained Earnings 
Substituting the given values, we get: 
Dividends = $30,300 - $8,000 
Dividends = $22,300 
Therefore, the answer is B, $22,300.

If There Was No Beginning Retained Earnings, Net Income of $30,300