Q14SE
Question
Preparing a statement of retained earnings
Kingston, Inc. had beginning retained earnings of \(135,000 on January 1, 2018. During the year, Kingston declared and paid \)85,000 of cash dividends and earned $75,000 of net income. Prepare a statement of retained earnings for Kingston, Inc. for the year ending December 31, 2018.
Step-by-Step Solution
Verified Answer
A statement of retained earnings for the year ending December 31, 2018 shows $125,000 ending retained earnings.
1Step 1: Information given
Beginning retained earnings:$135,000
Dividend declared and paid:$85,000
Net Income:$75,000
2Step 2: Statement of retained earnings
Statement of Retained Earnings | |
Beginning retained earnings | $135,000 |
Less: Dividend paid | ($85,000) |
Add: Net Income | $75,000 |
Ending retained earnings | $125,000 |
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