At the end of 20X3, Libby Company reported an ending balance for retained earnings of $50,000. During 20X4, the company reported the following amounts: dividends declared and paid $30,000, and proﬁt $40,000. The 20X4 retained earnings account should report an ending balance of
A) $60,000.
B) $80,000.
C) $90,000.
D) $100,000.

Question

Quizplus · Accepted Answer

The ending balance of retained earnings for 20X4 is calculated by starting with the beginning balance ($50,000), adding the profit for the year ($40,000), and subtracting the dividends paid ($30,000). This results in an ending balance of $60,000.

At the End of 20X3, Libby Company Reported an Ending