The following amounts represent totals from the first three years of operations.Calculate the balance of Retained Earnings at the end of 2018. $$\begin{array} { | l | r | r | r | }
\hline & \mathbf { 2 0 1 6 } & \mathbf { 2 0 1 7 } & \mathbf { 2 0 1 8 } \
\hline \text { Net Income } & \$ 1,200 & - \$ 500 & \$ 2,300 \
\hline \text { Net Cash Flows } & \$ 500 & \$ 300 & \$ 2,800 \
\hline \text { Diwidends } & \$ 200 & \$ 0 & \$ 200 \
\hline \text { Issuance of Stock } & \$ 2,000 & \$ 0 & \$ 0 \
\hline
\end{array}$$

Question

The following amounts represent totals from the first three years of operations.Calculate the balance of Retained Earnings at the end of 2018. $$\begin{array} { | l | r | r | r | } 
\hline & \mathbf { 2 0 1 6 } & \mathbf { 2 0 1 7 } & \mathbf { 2 0 1 8 } \
\hline \text { Net Income } & \$ 1,200 & - \$ 500 & \$ 2,300 \
\hline \text { Net Cash Flows } & \$ 500 & \$ 300 & \$ 2,800 \
\hline \text { Diwidends } & \$ 200 & \$ 0 & \$ 200 \
\hline \text { Issuance of Stock } & \$ 2,000 & \$ 0 & \$ 0 \
\hline
\end{array}$$

Quizplus · Accepted Answer

Retained Earnings at the end of 2018 = Net Income - Dividends + Net Cash Flows= (1,200 - 500 + 2,300) - (200 + 0 + 200) + (500 + 300 + 2,800)= 2,600

The Following Amounts Represent Totals from the First Three Years