Using the Percentage of Sales Method,forecasted Retained Earnings Balance Is

question 77

Multiple Choice

Using the percentage of sales method,forecasted retained earnings balance is equal to

• A) prior year retained earnings plus projected net income less projected dividends.
• B) the ratio of retained earnings to sales for the current year multiplied by projected sales for next year.
• C) the retained earnings balance for the current year as no changes are made to this financing account when using the percent of sales method.
• D) the ratio of retained earnings to sales for the current year multiplied by projected sales for next year, minus dividends paid.

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