Jamaican Ice Cream Corp. started the year with a balance of retained earnings of $100 million. The company reported net income for the year of $45 million, paid dividends of $2 million to the preferred stockholders and $15 million to common stockholders. What is Jamaican Ice Cream's end of year balance in retained earnings?
A) $38 million
B) $55 million
C) $128 million
D) $162 million

Question

Quizplus · Accepted Answer

The end of year balance in retained earnings is calculated by starting with the beginning balance, adding net income, and subtracting dividends paid. So, $100 million + $45 million - $2 million - $15 million = $128 million.