Consider the balance sheet of Wilkes Industries as shown below.Wilkes has $1,000,000 in common stocks and retained earnings.As a result we can state which of the following regarding Wilkes?
A) that it 80% of Wilkes shareholder equity comes from issuing more stock.
B) 20% of Wilkes shareholder equity comes from accumulated profitable earnings of prior years operations.
C) They 80% of Wilkes shareholder equity comes from accumulated profitable earnings of prior years operations..
D) Wilkes Industries has had consistently unprofitable operations as indicated by the low common equity relative to its retained earnings.
Correct Answer:
Verified
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