Rock Springs Company earns a net income of $574,000 and pays dividends of $52,000 during the period. Rock Springs has ending retained earnings of $978,000.
The balance in Rock Springs' beginning retained earnings must have been:

Question

Quizplus · Accepted Answer

Ending retained earnings = Beginning retained earnings + Net income (loss) - Dividends
$978,000 = X + $574,000 - $52,000
X = $978,000 - $574,000 + $52,000
X = $456,000

Rock Springs Company Earns a Net Income of $574,000 and Pays