What Will Be the Effect on Retained Earnings If a Firm

question 117

Multiple Choice

What will be the effect on retained earnings if a firm with 5,000 shares outstanding earns $10 per share and has a 30% plowback ratio? It will increase by:

• A) $15,000.
• B) $30,000.
• C) $35,000.
• D) $50,000.

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