[The Following Information Applies to the Questions Displayed Below

question 21

Multiple Choice

[The following information applies to the questions displayed below.]
Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.)
1) Acquired $950 cash from the issue of common stock.
2) Borrowed $420 from a bank.
3) Earned $650 of revenues.
4) Paid expenses of $250.
5) Paid a $50 dividend.
During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.)
1) Issued an additional $325 of common stock.
2) Repaid $220 of its debt to the bank.
3) Earned revenues of $750.
4) Incurred expenses of $360.
5) Paid dividends of $100.
-What is the after-closing amount of retained earnings that will be reported on Packard's balance sheet at the end of Year 2? (Assume that closing entries have been made) .

• A) $640
• B) $800
• C) $290
• D) $740

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