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(STATEMENT OF STOCKHOLDERS’ EQUITY) In its most recent financial statements, Nessler Inc. reported $75 million of net income and $825 million of retained earnings. The previous retained earnings were $784
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(STATEMENT OF STOCKHOLDERS’ EQUITY) In its most recent financial statements, Nessler Inc. reported $75 million of net income and $825 million of retained earnings. The previous retained earnings were $784 million. How much in dividends were paid to shareholders during the year? Assume that all dividends declared were actually paid.

User Tropin Alexey
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1 Answer

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19 votes

Final answer:

The dividends paid to shareholders during the year can be calculated by finding the change in retained earnings.

Step-by-step explanation:

To calculate the dividends paid to shareholders during the year, we need to find the change in retained earnings. Retained earnings represent the cumulative profits of a company that have not been distributed as dividends. The change in retained earnings is calculated by subtracting the previous retained earnings from the current retained earnings:

Change in Retained Earnings = Current Retained Earnings - Previous Retained Earnings

Change in Retained Earnings = $825 million - $784 million

Change in Retained Earnings = $41 million

Therefore, $41 million in dividends were paid to shareholders during the year.

User Isaac Moses
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