Use the Following Information for Questions

question 15

Multiple Choice

Use the following information for questions.
At December 31, 2016, the balance in Helsinki Ltd.'s retained earnings account was $420,000.During 2017, Helsinki had the following transactions:
Acquired 5,000 treasury shares at $27 a share.The shares are no par and had originally been issued for $24 per share.There had been no previous treasury shares transactions.
Sold the 5,000 treasury shares at $32 a share.
Reported net income of $150,000.
-Instead, assume Helsinki cancelled the 5,000 shares when it acquired them.The balance in retained earnings at December 31, 2017 would then be

• A)$555,000.
• B)$570,000.
• C)$585,000.
• D)$610,000.

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Definitions:

Straight-Line Method

A technique for estimating an asset's depreciation, where it's presumed the asset depreciates uniformly each year throughout its productive lifespan.

Delivery Equipment

This refers to the machinery and vehicles used for the purpose of transporting goods to customers.

Sales Taxes

Taxes imposed by governments on the sale of goods and services.

Motor Vehicle Licenses

Fees paid to a governmental authority for the registration and licensing of vehicles for operation on public roads.