The Income Statement for August Indicates Net Income of $100,000

question 44

Multiple Choice

The income statement for August indicates net income of $100,000.The corporation also paid $25,000 in dividends during the same period.If the company is in operation for only one month and has no beginning balance in retained earnings, what is the ending balance in retained earnings?

• A) $75,000
• B) $100,000
• C) $20,000
• D) $125,000

---

Definitions:

Internal Rate

Often refers to the internal rate of return (IRR), which is a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Net Present Value

A financial metric used to evaluate the profitability of an investment, accounting for its time value of money.

Capital Budgeting

The process of planning significant investments in projects that have long-term implications such as the purchase of new equipment or the introduction of a new product.

Screening Tool

A method or instrument used to assess or evaluate certain characteristics in individuals or scenarios, often used in healthcare, employment, and research.