Which of the Following Statements Regarding Net Income Transferred to Retained

question 58

Multiple Choice

Which of the following statements regarding net income transferred to retained earnings is correct?

• A) Net income = net income transferred to retained earnings - dividends
• B) Net income transferred to retain earnings = net income + dividends
• C) Net income = net income transferred to retain earnings + dividends
• D) Net income transferred to retain earnings - net income = dividends

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Definitions:

Bonds

Financial instruments representing a loan made by an investor to a borrower, typically corporate or governmental, where the borrower commits to paying back the principal along with interest.

Retirement

The act of leaving one's job and ceasing to work, typically due to age, with various financial planning strategies employed to ensure financial security.

Future Interest

A legal right to property ownership, possession, or enjoyment that begins at a future date.

Effective Interest Method

A technique used in accounting to allocate the discount or premium on bonds payable over their life to interest expense, reflecting a constant rate of interest.