Question

The accountant for Huckleberry Company is preparing the company's statement of cash flows for the fiscal year just ended. The following information is available:

Retained earnings balance at the beginning of the year $151,000
Cash dividends declared for the year $46,000
Net income for the year $92,000
What is the ending balance for retained earnings?
a) $264,000.
b) $13,000.
c) $243,000.
d) $197,000.
e) $105,000.

Answer 1

The ending balance for retained earnings is $197,000

Step-by-step explanation:

Calculation of available retained earnings of the company

Available retained earnings = Beginning retained earnings + Net income

= $ 151,000 + $92,000

= $ 243,000

Thus, the available retained earnings is $243,000.

Calculation of ending balance for retained earnings.

Ending balance for retained earnings = Available retained earnings balance - Dividend paid

= $ 243,000 - $46,000

= $ 197,000

Thus, the ending balance for retained earnings is $197,000.