At the End of Year 2, Retained Earnings for the Baker

question 200

Multiple Choice

At the end of Year 2, retained earnings for the Baker Company was $2,650. Revenue earned by the company in Year 2 was $2,900, expenses paid during the period were $1,550, and dividends paid during the period were $950. Based on this information alone, what was the amount of retained earnings at the beginning of Year 2?

• A) $3,050
• B) $2,250
• C) $5,800
• D) $1,300

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Definitions:

Absorption

The process by which substances are taken up and incorporated into the body, as in nutrient absorption in the digestive tract.

Distribution

The process by which goods, services, or resources are delivered or spread over an area or among a population.

Metabolism

The chemical processes that occur within a living organism to maintain life, involving the conversion of food to energy and new materials.

Excretion

The process by which the body removes waste products of metabolism and other non-useful materials.