On January 1, 2016, Miller Corporation had retained earnings of $8,000,000. During 2016, Miller reported net income of $1,500,000, declared dividends of $500,000, and issued common stock for $1,000,000. What were Miller's retained earnings on December 31, 2016?

Question

Quizplus · Accepted Answer

Retained earnings on December 31, 2016 can be calculated as:
Retained earnings on January 1, 2016 + Net income - Dividends - Stock issuance
= $8,000,000 + $1,500,000 - $500,000 - $1,000,000
= $9,000,000
Therefore, the correct answer is C.

On January 1, 2016, Miller Corporation Had Retained Earnings of $8,000,000