Twine Enterprises Reported Sales of $3 Million and Net Income

question 71

Multiple Choice

Twine Enterprises reported sales of $3 million and net income of $400,000 for 2010.The retained earnings balance at the end of 2010 is $7 million.Twine Enterprises has a dividend payout ratio of 30%.If sales are expected to increase by 25% next year,what will be the projected balance in retained earnings using the percent of sales method?

• A) $7,280,000
• B) $6,720,000
• C) $7,350,000
• D) $8,750,000

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Definitions:

Red Blood Cells

Cells in the blood which carry oxygen from the lungs to the body's tissues and returns carbon dioxide from the tissues back to the lungs.

Ligaments

Fibrous connective tissues that connect bones to other bones, providing stability and support to joints.

Hyaline Cartilage

A type of cartilage found at the ends of bones, in the nose, and in the trachea, characterized by its glossy, translucent appearance.

Synovial Membrane

A specialized connective tissue lining the inner surface of capsules of synovial joints and tendon sheaths, producing synovial fluid for lubrication.