Question

Viva Travel Service

Statement of Stockholders' Equity
For the Year Ended September 30, 20Y6

Retained Earnings, October 1, 20Y5 $49,330
Add: Net Income (Fees Earned - Expenses)
Fees Earned 649,100
Less: Expenses
Miscellaneous Expense 5,040
Rent Expense 84,060
Supplies Expense 13,450
Utilities Expense 50,440
Wages Expense 240,170
__________
Total Expenses $393,160
__________
Net Income $255,940
Subtotal $305,270

Less: Dividends Paid $(23,200)
__________
Retained Earnings, September 30, 20Y6 $282,070

What is the Retained Earnings balance as of September 30, 20Y6, according to the provided information?

A) $305,270
B) $282,070
C) $255,940
D) $49,330

Answer 1

The Retained Earnings balance for Viva Travel Service as of September 30, 20Y6 is $282,070. This is calculated by adding the net income of $255,940 to the opening retained earnings and then subtracting dividends paid.

Step-by-step explanation:

The Retained Earnings balance as of September 30, 20Y6, according to the provided information is $282,070. This figure is arrived at by starting with the initial Retained Earnings at October 1, 20Y5, which was $49,330, adding the Net Income for the year ($255,940), and then subtracting the Dividends Paid ($23,200).