Question

Pinson company began the year with retained earnings of $670,000. during the year, the company recorded revenues of $600,000, expenses of $380,000, and paid dividends of $140,000. what was pinson's retained earnings at the end of the year?

Answer 1

Formula:
Retained Earnings (RE) = Beginning RE + Net Income - Dividends

Given:
Beginning RE = $670,000
Revenues = $600,000
Expenses = $380,000
Dividends = $140,000

Retained Earnings = $670,000 + ($600,000-$380,000) - $140,000
*You can get the net income by subtracting the expenses on the revenue.
Retained Earnings =$750,000

Pinson's retained earnings at the end of the year is $750,000.