Retained Earnings had a balance on January 1, 2008, and December 31, 2008, respectively, of $255,300 and $413,000. Net income for the year was $188,700 and the only other event affecting Retained Earnings was the declaration of dividends. If there was no change in the Dividends Payable account during the year, the payments for dividends were:

Question

Quizplus · Accepted Answer

The change in Retained Earnings is calculated as the ending balance minus the beginning balance, which is $413,000 - $255,300 = $157,700. Since net income was $188,700, the dividends paid must have been $188,700 - $157,700 = $31,000.

Retained Earnings Had a Balance on January 1, 2008, and December