How Is a Firm's Retained Earnings at the End of the Year

question 77

Multiple Choice

How is a firm's retained earnings at the end of the year calculated?

• A) Retained earnings = Beginning balance of retained earnings minus net income in the current year plus net loss in the previous year
• B) Retained earnings = Beginning balance of retained earnings plus net income in the current year plus dividends paid in the current year
• C) Retained earnings = Beginning balance of retained earnings plus net income in the current year minus dividends paid in the current year
• D) Retained earnings = Beginning balance of retained earnings minus net loss in the previous year minus dividends paid in the current year
• E) Retained earnings = Beginning balance of retained earnings minus net income in the current year plus dividends paid in the current year

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