The Records of a Corporation for Year 3 Reflected the Following

question 52

Essay

The records of a corporation for year 3 reflected the following correct pre-tax amounts: cash dividends declared and paid, $16,000; retained earnings, January 1, year 3, $120,000, correction of accounting error, $10,000 debit; income before income taxes and before extraordinary item, $60,000. The average income tax rate of 40 percent applies to all items except the dividends.
The December 31, year 3 (ending) balance of retained earnings was $________________.

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Definitions:

Incentive Scheme

An incentive scheme is a plan or system designed to motivate and encourage employees to perform better by offering rewards or benefits.

Feasible Production

A concept that refers to the various combinations of goods and services that a company can produce within a specified period under given conditions with the available resources.

Bonus Payment

Additional compensation given to employees on top of their regular salary, usually as a reward for achieving specific goals or for exceptional performance.

High Skill Students

Individuals pursuing education who possess, or are being trained to possess, above-average abilities, competencies, and knowledge in a particular field or subject.