Question

Moorman Corporation reports adjustments: Correction of past depreciation understatement, dividends declared, net income, and retained earnings as of 1/1/12. What should be the adjusted retained earnings on 1/1/12?

a. $2,355,000.
b. $3,000,000.
c. $3,645,000.
d. $4,665,000.

Answer 1

The adjusted retained earnings on 1/1/12 can be calculated by considering the beginning retained earnings, net income, dividends declared, and correction of past depreciation understatement. The question does not provide specific values, so it is not possible to determine the exact adjusted retained earnings.

Step-by-step explanation:

The adjusted retained earnings on 1/1/12 can be calculated by taking the beginning retained earnings and adding the net income and dividends declared for the period. Since the question mentions that there were adjustments made for correction of past depreciation understatement, we need to consider the effect of this adjustment as well.

So the adjusted retained earnings on 1/1/12 would be: Beginning retained earnings + Net income - Dividends declared + Correction of past depreciation understatement.

Without specific values provided, it is not possible to calculate the exact adjusted retained earnings on 1/1/12. Therefore, none of the options provided (a. $2,355,000, b. $3,000,000, c. $3,645,000, d. $4,665,000) can be confidently determined as the correct answer.