If Retained Earnings at December 31,2018,is $100,000,Equipment is carried in Hercules Manufacturing,Inc.accounting records at:
A)$ 42,000.
B)$ 58,000.
C)$ 43,500.
D)$345,000.

Question

Quizplus · Accepted Answer

Retained earnings and equipment are two separate accounts on the balance sheet. Therefore, Retained Earnings at December 31, 2018, has no impact on the value of Equipment. To determine the value of Equipment, additional information is needed. Without such information, we cannot definitively choose any of the answer choices.

If Retained Earnings at December 31,2018,is $100,000,Equipment Is Carried in Hercules