Mountain Company earns a net income of $430,500 and pays dividends of $39,000 during the period. Mountain has ending retained earnings of $733,500.
The balance in Mountain's beginning retained earnings must have been:

Question

Quizplus · Accepted Answer

Ending retained earnings = Beginning retained earnings + Net income (loss) - Dividends
$733,500 = X + $430,500 - $39,000
X = $733,500 - $430,500 + $39,000
X = $342,000

Mountain Company Earns a Net Income of $430,500 and Pays