On January 1,2010,Denmark Inc.,started the year with a $200,000 credit balance in its retained earnings account.During 2010,the company earned net income of $70,000 and declared and paid dividends of $10,000.Also,the company received cash of $15,000 as an additional investment by its owners.What is the balance in retained earnings on December 31,2010?
A)$200,000
B)$270,000
C)$245,000
D)$260,000

Question

Quizplus · Accepted Answer

Retained earnings on December 31, 2010 = $260,000 = $200,000 + $70,000 - $10,000