Crawford Company started the year with $60,000 in its Common Stock account and a credit balance in Retained Earnings of $44,000.During the year, the company earned net income of $48,000, and declared and paid $20,000 of dividends.In addition, the company sold additional common stock amounting to $28,000.As a result, the balance in retained earnings at the end of the year would be
A)$160,000.
B)$72,000.
C)$132,000.
D)$100,000.

Question

Quizplus · Accepted Answer

The ending balance in retained earnings is calculated as the beginning balance plus net income minus dividends. Starting with $44,000, add the net income of $48,000, and subtract the dividends of $20,000, resulting in an ending balance of $72,000.

Crawford Company Started the Year with $60,000 in Its Common