For the past five years,Mookie Consulting Services reported the following annual net income and dividend amounts: If Mookie had Retained Earnings of $88,000 at the end of year 5,what was the company's Retained Earnings at the beginning of Year 1?
$$\begin{array} { | l | r | r | }
\hline \text { Year } & \text { Net Income } & \text { Dividends } \
\hline 1 & \$ 22,000 & \$ 2,000 \
\hline 2 & 17,000 & 2,000 \
\hline 3 & 9,000 & 1,000 \
\hline 4 & 14,000 & 3,000 \
\hline 5 & 25,000 & 4,000 \
\hline
\end{array}$$
A)$13,000.
B)$25,000.
C)$7,000.

Question

For the past five years,Mookie Consulting Services reported the following annual net income and dividend amounts: If Mookie had Retained Earnings of $88,000 at the end of year 5,what was the company's Retained Earnings at the beginning of Year 1?
$$\begin{array} { | l | r | r | } 
\hline \text { Year } & \text { Net Income } & \text { Dividends } \
\hline 1 & \$ 22,000 & \$ 2,000 \
\hline 2 & 17,000 & 2,000 \
\hline 3 & 9,000 & 1,000 \
\hline 4 & 14,000 & 3,000 \
\hline 5 & 25,000 & 4,000 \
\hline
\end{array}$$
A)$13,000.
B)$25,000.
C)$7,000.

Quizplus · Accepted Answer

Retained Earnings at the beginning of Year 1 = Retained Earnings at the end of Year 5 - Net Income for Years 1-5 + Dividends for Years 1-5= $88,000 - $22,000 - $17,000 - $9,000 - $14,000 - $25,000 + $2,000 + $2,000 + $1,000 + $3,000 + $4,000= $13,000

For the Past Five Years,Mookie Consulting Services Reported the Following