For the year 2016, net income of Carol Company is $20,000 and dividends declared are $6,000; therefore, retained earnings have increased $26,000 during the year.

Name: For the year 2016, net income of Carol Company is $20,000 and dividends declared are $6,000; therefore, retained earnings have increased $26,000 during the year.
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Question

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Retained earnings only increase by the amount of net income minus dividends declared. In this case, the increase in retained earnings would be $14,000 ($20,000 - $6,000).

For the Year 2016, Net Income of Carol Company Is