If total liabilities are $135 000, total assets are $420 000 and total paid-up capital is $180 000, the amount of retained earnings is:

Question

Quizplus · Accepted Answer

Total liabilities + total paid-up capital + retained earnings = total assets

Therefore,

Retained earnings = total assets - total liabilities - total paid-up capital 
Retained earnings = $420 000 - $135 000 - $180 000 
Retained earnings = $105 000

Hence, the retained earnings are $105 000.

If Total Liabilities Are $135 000, Total Assets Are $420