By looking at a statement of retained earnings,the effect of dividends on the ending balance in retained earnings can be determined.

Question

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The statement of retained earnings shows the beginning balance, net income or loss, any adjustments or allocations, and the dividends paid during the period, which ultimately leads to the ending balance in retained earnings. Therefore, by analyzing the statement of retained earnings, the effect of dividends on the ending balance in retained earnings can be determined.

By Looking at a Statement of Retained Earnings,the Effect of Dividends