Final answer:
The retained earnings balance for Assembly System Corporation at the end of December 31, 2017, would be $590,000 after accounting for dividends declared and the net loss.
Step-by-step explanation:
The calculation of the ending balance in retained earnings for Assembly System Corporation for the year ending December 31, 2017, can be done by adjusting the beginning balance with the declared dividends and the reported net loss for 2017.
Here is the step-by-step computation:
- Start with the beginning retained earnings balance: $675,000.
- Subtract cash dividends declared: $675,000 - $25,000 = $650,000.
- Subtract stock dividends declared: $650,000 - $55,000 = $595,000.
- Adjust for the net loss: $595,000 - $5,000 = $590,000.
The ending balance in retained earnings on December 31, 2017, would therefore be $590,000.